High-tech supremacy at stake in US-China trade war

BEIJING  A race for global supremacy in the tech sector is at the centre of the fraught trade war negotiations between the US and China.

The US has long been the world’s high-tech champion, although China has made major strides and even taken the lead in some sectors.

But US President Donald Trump accuses Beijing of snatching American technological know-how — a key sticking point in negotiations that entered a crucial round in Washington last Thursday and Friday.

Here are China’s advances in the tech sector:

Made in China 2025

The Communist Party has touted a programme named “Made in China 2025” which aims to turn the Asian giant into a powerhouse of new technologies, from aerospace and telecommunications to robotics, biotechnology and electric vehicles.

Beijing is aiming for technological self-sufficiency on 70% of key components and materials by 2025.

The plan has alarmed Washington — which fears losing a valuable market — and has complicated the trade talks between China and the US.

While Premier Li Keqiang did not mention Made in China 2025 in his speech to the annual Parliament in March, experts doubt that Beijing will drop this strategic plan.

Huawei, Leader of 5G

Chinese telecom giant Huawei Technologies Co Ltd has made great progress in its effort to become the global leader in next-generation 5G wireless technology.

But Washington considers the company — founded by former army engineer Ren Zhengfei — to be a security risk and has urged allies to shun its equipment over fears it could serve as a Trojan horse for Chinese intelligence services.

The US government has banned all federal agencies from acquiring Huawei equipment.

Washington has accused Huawei CFO Meng Wanzhou of circumventing sanctions against Iran, and has applied for her extradition from Canada where she is currently free on bail.

ZTE and China Mobile

Last year, US authorities banned the sale of electronic equipment from another Chinese telecom firm, ZTE Corp, after charging it with violating sanctions on Iran and North Korea.

The company, with 75,000 employees, was on the verge of bankruptcy until Trump rescinded the decision.

In return, ZTE pledged to pay a US$1 billion (RM4.16 billion) fine and accept oversight by US agents in its offices for 10 years.

Last Thursday, US regulators clamped down on China Mobile Communications Corp, denying the company’s request to operate in the US market and provide international telecommunications services, saying links to the Chinese government posed a national security risk.

Drones

A new DJI Mavic Zoom drone flies during a product launch event last year. Founded in 2006 in Shenzhen, which has been dubbed China’s ‘Silicon Valley of Hardware’, DJI produces 70% of the world’s commercial drones (Pic: AFP)

SZ DJI Technology Co Ltd is the world’s No 1 producer of commercial and hobby drones, which are used for aerial pictures and video.

Founded in 2006 in Shenzhen, which has been dubbed China’s “Silicon Valley of Hardware”, the company produces 70% of the world’s commercial drones and has no major US competitor since the withdrawal of California’s GoPro from the market.

However, its dominance has not gone unnoticed. Since 2017, the Pentagon has banned the military from using DJI drones for security reasons.

Iron Curtain

Some experts warn of the risk of having a world separated by a “technological iron curtain” in social media and online buying.

In China, tech giants Baidu Inc, Alibaba Group Holding Ltd and Tencent Holdings Ltd — collectively called BAT — dominate the market thanks in part to Beijing’s online censorship apparatus or “Great Firewall”, which blocks the likes of Google and Facebook Inc.

The country’s own smartphone firms, such as Huawei, Oppo (Guangdong Oppo) Mobile Telecommunications Corp Ltd) and Vivo (Vivo Communication Technology Co Ltd), are also market leaders domestically, beating US tech giant Apple Inc.

Local firms are also winning the battle for eyeballs in China, where Chinese apps like WeChat are used for everything from shopping to texting to playing games.

GPS

In the field of geolocation, China has distanced itself from the US global positioning system (GPS) system and designed its own satellite navigation network known as BeiDou, or Big Dipper.

It relies on a network of about 30 satellites and is expected to be fully operational worldwide from next year.

Beijing is counting on its trillion-dollar Belt and Road global infrastructure project to convince participating countries to use its technology.

AI

Trump has made artificial intelligence (AI) a priority sector, with the Pentagon announcing a US$2 billion budget last year specifically for the technology.

China’s ambitions are even grander, with plans to invest US$150 billion in the sector by 2030.

Patent Power

The US still files more patents than any other country, but China is expected to overtake them by 2020, according to the World Intellectual Property Organisation.

In 2017 — when figures were last released — two Chinese firms came out on top for patents filed by a company, with Huawei (4,024 applications) and ZTE (2,965), beating Intel Corp (2,637) into third place. — AFP