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

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

👤 H K Badal11 May 2019 3:40 PM GMT
High-tech supremacy at stake in US-China trade warThe Huawei logo is seen at a bus stop in Mexico City, Mexico on 22 February 2019. Reuters File Photo
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Beijing, AFP

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

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

But president Donald Trump accuses Beijing of snatching American technological know-how -- a key sticking point in negotiations that entered a crucial round in Washington on 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 per cent 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 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 chief financial officer 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, after charging it with violating sanctions on Iran and North Korea.

The company, with 75,000 employees, was on the verge of bankruptcy until US president Donald Trump rescinded the decision.

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

On Thursday, US regulators clamped down on China Mobile, 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

DJI is the world's number one 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 per cent 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, Alibaba, and Tencent, 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.

The country's own smartphone firms, such as Huawei, Oppo and Vivo, are also market leaders domestically, beating US tech giant Apple.

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 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.

Artificial intelligence

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

China's ambitions are even grander, with plans to invest $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 (WIPO).

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 (2,637) into third place.