The recent decline in US political influence on regional geopolitical systems and populist nationalism under President Trump have put the technological conflict between the US and China on the path to technical-commercial bipolarity. According to Francis Fukuyama, the rise of populism in the United States (US) under President Donald Trump led to the emergence of increasingly inward-looking politics. Anti-immigration, protectionist-mercantilist, control of the press alongside institutional deterioration. In addition, systemic factors such as the financial crisis outbreak in 2007, Russia’s foreign strategies in Eastern Europe, the US withdrawal from Afghanistan, Brexit and, more recently, COVID-19 have created both opportunities and constraints in regional geopolitical systems such as South Asia, Southeast Asia , the EU and Eastern Europe. For the developing countries within the regional geopolitical system infrastructure, the infrastructure, especially in the technical-commercial area, remains of central importance. For example, according to estimates by the Asian Infrastructure Investment Bank (AIIB): “Despite the increasing importance of the digital economy, the funding gap for the digital infrastructure in Asia is growing significantly and is estimated at 512 billion US dollars by 2040.”
The vitality of tech-commercialism not only means that developing countries are integrated into a globalized world, but it also sticks to self-sufficiency, in which limited resources must be optimally used. For example, high-tech manufacturing, artificial intelligence, modern telecommunications systems, big data science, and affordable hardware are all essential economic needs. This is because nowadays numerous industries such as education, medicine, research, banking, consulting, logistics and construction are increasingly dependent on a changing way of working, in which technological innovation has become a decisive influencing factor. In addition, the US, Japan, China and the EU rely on developing countries for technological innovation and technology transfer to meet demand from the developing global tech commerce.
However, the essential question remains of how developing countries in regional geopolitical systems would react in the face of the technological rift between the US and China. Since the American unipolarity in the international system determines numerous rules and norms both in the world economy and in security, it now appears to be in danger. Since Donald Trump became President of the United States, US liberalism has been camouflaged under populist nationalism, which only downgrades the concept of the global free market system. According to Fareed Zakaria:
I have to be honest, the most worrying country is the United States. America is still a tremendous power – both materially and symbolically – but I would argue that the erosion seems to be stronger here than in other places.
In addition, the trade imbalances and conflicts in a number of bilateral US-China affairs should not be viewed as a new political debate. Arguably the crux of the matter was China’s accession to the World Trade Organization (WTO) in 2001, which changed the structure of the international economy in which China’s ability to fill trade gaps in both developed and developing countries became unprecedented. Trump’s rhetoric against China became increasingly aggressive during the 2016 presidential campaign as he emphasized China’s unfair trade practices that led to the trade war, and by mid-2018 the US had imposed tariffs on Chinese goods of $ 200 billion.
It is important to note that during Barack Obama’s administration, geopolitics set a new precedent as systemic events unfolded, such as Russia’s foreign strategies in Eastern Europe, the US withdrawal from Afghanistan, US-Russian interests over Syria, and the global financial crises and China’s strategy under the Belt and Road Initiative (BRI). The capabilities of the USA in the regional geopolitical systems were probably openly called into question by the assertiveness of Russia in the former Soviet states and the greater economic influence of China in Asia through its BRI strategy. After the global financial crisis, China has certainly emerged as a business leader
The American state of emergency among its competing realistic-liberalist values is now facing new systemic forces in regional geopolitical systems. These changes are unlikely to be major structural changes, as America’s seventy years of investment and development in institutions and technological innovation arguably outperform any challenger. Still, the Trump administration’s policies of giving way to populist nationalism, coupled with geopolitical fluctuations due to power shifts, have contributed to a protectionist path and exacerbated the ongoing technological divide between the US and China. As Fareed Zakaria rightly points out, “Trump’s disdain for democratic norms could haunt us for years.”
Ideological divisions between the American executive and the legislature on foreign policy issues have long been evident. In 2018, President Trump won support from the Senate for his negative stance on China’s predatory policies on key issues such as trade, investment, national security, intellectual property and technological theft. In terms of regional technological innovations such as 5G in particular in developing countries and the advancement of future telecommunications systems, the technological gap between the US and China has widened. This is mainly because the Trump administration has seen a strong link between companies like Huawei and China’s security interests. By the end of 2019, given the challenges to the overall national security threat, the U.S. Federal Communications Commission agreed to use the Universal Service Fund of $ 8.5 billion annually to purchase services and equipment from both Huawei and Huawei to ban from ZTE in China.
In 2019, it is estimated that the US lost around 300,000 jobs and American companies lost an estimated $ 1.7 trillion on the stock market. According to Zakaria
We may be moving towards a bipolar world in digital technology with two isolated ecosystems: the US and the Chinese. This split would undermine the open world economy, deep interdependence, and cross-border investment and supply chains that characterize today’s world economy.
In addition, the US tech trading sector, which specializes in microchip, artificial intelligence and biotechnology manufacturing, has expressed major reservations about falling revenues and resorting to its expertise, particularly as it has turned its back on logistics and deliveries, contributing to China’s emerging technology sector.
It’s also important to note that China’s global technology market share has grown significantly worldwide. It is estimated that it would be around 16% by 2023. For example, four of the world’s six leading smartphone providers are Chinese: Huawei, Oppo, Vivo and Xiaomi. In China, however, the technical skills are probably lacking, especially in the manufacture of the semiconductor. Despite China’s heavy reliance on self-sufficiency policies, China’s reliance on American tech industries remains vital, at least in the short term. For example, according to William Bao Bean, who runs the China accelerator (startup) based in Shanghai
There is an enormous amount of investment in government policy. The Chinese government really supports investments in semiconductors, telecommunications equipment and many traditional hardcore technologies. But because of the technical decoupling between the US and China and the difficulty of sourcing international semiconductors, telecommunications equipment, and even manufacturing equipment, you are seeing massive investment in these areas in China … China’s semiconductor industry is lagging behind. However, if you spend money on a problem, you will generally get a solution faster. I still think China was four to seven years ago.
In essence, on the way to becoming transcendent, any emerging power must have the ability to translate its economic wealth into technological capabilities that match the leading power. China is currently lacking this determination: “China’s real Achilles heel on the world stage is something else: the lack of technological know-how compared to the United States.” In the commercial sector in particular, a bipolar technological structure seems to some extent inevitable. However, external cyclical factors such as the COVID-19 pandemic and responses of smaller states to geopolitical systems, as well as structural factors such as the depth of the American alliance system, would predict both the polarity and size of the technological structure. The political divide within the US and the recent US presidential election have now led to uncertainties about the bipolarity of technologies. Most significantly, the magnitude of this tug-of-war, especially from the US, has had a huge cyclical impact both domestically and globally in the tech space.
Given the impact of Trump’s populism and ongoing regional geopolitical tensions, the technological rift between the US and China has created new challenges and opportunities. This raises important questions for developing countries in APAC, according to the latest Asian Development Bank (ADB) estimates, “Asia and the Pacific will need $ 26 trillion in high-quality infrastructure finance over the next decade.” It must be noted that for the past decade, China has been able to fill these gaps for weaker states like Sri Lanka, Laos and Myanmar through its BRI strategy and other economic resources. It is conceivable to argue that these states would look for technological development in China within certain regional geopolitical systems in which China could deliver. In the long term, the bipolarity between technology and trade can plausibly develop in these regional geopolitical regions, mainly because Chinese companies may be the only ones offering sustainable and affordable technical solutions. As a result, these persistent technological differences between the US and China are likely to continue when Joe Biden succeeds the Trump administration in early 2021.
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