Tech cold war with US may prompt China to be stronger, more independent: Chinese analyst

By Zhang Dan and Li Ruohan Source:Global Times Published: 2019/2/26 18:53:40 Last Updated: 2019/2/27 2:08:37

World’s two largest economies ‘too close to completely separate’

Visitors look at the intelligent expression pavilion of Hema Fresh Store, an online-to-offline retailer under the e-commerce platform Alibaba Group, at the Light of the Internet Expo during the fifth World Internet Conference in Wuzhen, East China's Zhejiang Province, in November 2018. The conference features topics such as artificial intelligence, 5G, big data and internet security. Photo: IC

Amid positive signs of an end to the US-China tariff war, Chinese industrial insiders warned that a technology cold war could be emerging in its place where the world economy splits into two camps. 

Chinese analysts noted that with a stronger research ability and better economic situation in China after decades of efforts, Beijing has no need to fear a technology cold war. 

But a technology cold war would come at a cost for both sides as the world's two largest economies are too close to completely exclude each other from their future development, they said. 

As early as the arrest of Huawei senior executive Meng Wanzhou in December 2018, some foreign scholars and media predicted a potential technology cold war between China and the US.

The US offensives have come against China in an all-round manner, the Chinese analysts noted, involving intelligence, executive and judicial sectors. 

"The more pressure China receives, the stronger our resolution will be to develop indigenous innovation and be more self-reliant," Shi Dinghuan, chairman of the World Green Design Organization and a former advisor to the State Council, told the Global Times.

Chinese observers' confidence stems from the country's increasing spending on technology development and relevant academic research.

China dominated a global ranking of the most-cited research papers published in the 30 hottest technology fields, Nikkei Asian Review reported in January.

Chinese businesses are expected to have a technology budget of 1.73 trillion yuan ($256.61 billion) this year, a 4 percent year-on-year increase. 

Spending in 2020 is estimated at 1.843 trillion yuan, business technology news website reported in January.

Xiang Ligang, chief executive of telecom industry news site, told the Global Times he didn't believe there would be such a cold war between China and the US. 

"Even if the technology cold war happens, China would have better strength than the US," Xiang said. 

Xiang cited China's energy, traffic and telecommunications industries to support his assumption. "Those fields were the weakest in the past, but now China leads the world," he said. 

Huawei Technologies has rapidly built the most advanced smartphone chip in the world, proving Chinese capabilities, Xiang noted. 

Huawei is the strongest company in the 5G industrial chain and will beat Apple sooner or later, he predicted. 

Apple suffered a 3.2 percent plunge in shipments in 2018 while Huawei's shipments surged 33.6 percent, according to research firm IDC. 

As of mid-January, Huawei had signed 30 5G contracts and shipped more than 25,000 5G base stations. Huawei possesses 2,570 5G patents, according to the company's website. 

China will be No.1 in terms of technology development of 5G and AI, Xiang said, noting that if the world telecom operators adopt Huawei's telecom equipment, they will save 30 percent on costs which equals years of profits. 

In spite of political pressure from Washington, Huawei will cooperate with partners around the world to succeed in the 5G era, Guo Ping, rotating chairman of Huawei Technologies, told the Global Times on Sunday ahead of the Mobile World Conference in Barcelona, Spain.

China also has the best industrial clusters in the world, Xiang asserted. 

"Ninety percent of mobile phones are produced in China as we have the most powerful comprehensive capability which other countries don't have," he said. 

Too close to completely separate

Despite predictions that a cold war may drive China and the US to build their own technological ecosystems that exclude each other and force other courtiers to choose, analysts stressed that in some areas, the world's two largest economies are too close to totally exclude each other. 

Their cooperation remains quite broad in the fields of Big Science, fundamental research, healthcare and that of people's livelihood, said Shi, the former State Council advisor. 

It's no surprise that the US has kept a sharp lookout for confidential projects or those related to national defense, such as cutting-edge technology and advanced weapons, he said. 

"China is the same. We don't want others to steal our core technology as well," Shi said, "And that's why China needs to rely on itself to develop its core technology of national defense and enhance self-dependent innovation."

Meanwhile, Xiang said that "no one benefits if the two shut the door on each other, and to be more accurate, both will suffer great losses if they do so."  

Foreign media have also warned that hasty or excessive behavior by the US runs the risk of undermining its own technological advantage.

Enhanced US scrutiny of China comes at a cost, according to a commentary from Bloomberg's editorial board published on February 14.

Such scrutiny caused a collapse of Chinese investment in the US, spurred Beijing to develop homegrown alternatives and drove some of China's "best and brightest" back home, it said.

Posted in: DIPLOMACY

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