Without rule of law, China risks becoming the lonely tech superpower

Andrei Lungu | 1 August 2020

Huawei has steadily emerged as a 5G pioneer, showing how a Chinese company can become a global heavyweight. Yet it has also become a different kind of pioneer: the first victim of a foreign blockade of Chinese technology companies, which could upend Beijing’s plans to become a global tech leader.

The argument underpinning the campaign against Huawei is that, because of China’s political and legal systems in which the Communist Party has absolute control, no company is truly independent and every company can become a tool of the party. As William Evanina, the director of the US National Counterintelligence and Security Centre, said: “Huawei … is not the problem; it’s the Communist Party of China.”

Huawei is just the first Chinese company that is strong and innovative enough to set off alarm bells in Western capitals. But it is becoming clear that it is not alone. When the financial arm of Alibaba wanted to acquire MoneyGram, it was blocked because of perceived risks to Americans’ personal data. The issue of personal data is also haunting TikTok, China’s first social media platform with global appeal, and the US government is mulling whether to ban it.

Meanwhile, the US Department of the Interior has grounded its DJI drones. And China’s artificial intelligence crown jewels, from SenseTime to Megvii, have joined Huawei on Washington’s entities list. Even trains from Chinese state-owned companies have not escaped, even if they are assembled in US factories.

This is happening not only in the US: Britain, reversing a previous decision, has restricted the use of Huawei gear in its 5G network, as has France, following countries such as Japan and Australia. Germany might be next, while the European Union
has recommended that member states restrict 5G tech companies from countries lacking the rule of law. India, which recently banned 59 Chinese apps, including TikTok and WeChat, might also restrict Huawei from its 5G network.

Huawei has remained successful in some developing countries, but risks being restricted from markets accounting for more than half the world’s gross domestic product. What does Huawei’s fate portend for China’s dream of becoming a global tech leader?

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This article has been published by Andrei Lungu, President of RISAP, in the South China Morning Post. You can read the full article on the SCMP website.

Photo Credits:  Logo Huawei (Flickr/QSC AG)

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Andrei Lungu​

Andrei Lungu is president of RISAP. His research interests include China’s foreign policy and its domestic politics, Sino-American relations and the balance of power in the Asia-Pacific.

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