- From an American perspective, there are a number of areas of contention in the Sino-American technological competition. First, China is perceived as having circumvented international rules for its own advantage. Second, it is believed that China is misusing emerging technologies like 5G and artificial intelligence (AI) for domestic political purposes. The third issue pertains to the American perception that too many international supply chains are concentrated in China, which is problematic given the risks of corporate espionage.
- These developments, among others, have fuelled a general consensus in Washington that China’s technological ambitions and development represent a strategic threat. But there are also those who think that the US may have overreacted to China’s technological plans, which they see as largely aspirational and not realistic in all aspects.
- Despite the perceived threat from China, the US is not doing enough and will likely lose out in the long term if it does not make a concerted effort to implement domestic policies that maintain its edge in science and technology. Some in Washington are also entertaining the idea of a national industrial policy, a notion that the US traditionally has been ideologically opposed to.
- From a Chinese perspective, the US-China technological competition is driven by a number of factors, including (i) a lack of basic trust between both countries; (ii) Washington’s own paranoia and ideological opposition to the Chinese system of state-guided policymaking; and (iii) the belief that China is rapidly closing the technological gap and would eventually overtake the US. China has no intention of replacing US primacy in the global order, nor does it perceive the US as an inherent enemy. However American actions have led the Chinese to believe that the US is attempting to delay China’s rise. The American accusation that China has developed through the theft of US technology is flawed because it underestimates or ignores Chinese capacity for innovation.
- As a result of American actions, China has been compelled to turn to other countries for alternatives to US technology in the short run. But because the US maintains political leverage over many countries, over the longer term, China will have to double-down on efforts to develop its own technologies, a move that might contribute to further decoupling between both countries. Other measures taken by China include efforts to facilitate global mergers, seek greater collaboration with non-American research institutions, and pursue technology co-development with other countries.
- 5G and AI technologies will be among the key battlegrounds in the US-China technological competition. A key issue for 5G concerns both the corporate and public sectors’ risk exposure to a security breach in the underlying network infrastructure. Government agencies handling sensitive data are at particular risk as a single breach in the network is all it takes for confidential information to be leaked indefinitely. From a national security perspective, the robustness of 5D data networks is paramount.
- It was noted that technology does not exist in isolation and is influenced by institutions, social context, political interests and ideology. Hence, technological advances can occur in different ways in different countries. In the EU, AI development has been influenced by an ethical approach that focuses on developing new enhancements without compromising civil liberties. In the US, the focus has been more on corporate trust and the provision of a conducive environment for private enterprises to thrive in a free and open market. For China, the state plays a central role in its technological development model, a paradigm that is also designed around the concept of cyberspace reflecting physical space. Here, state-driven AI initiatives integrate physical and virtual data through sensors, and are committed to strengthening civilian and military AI.
- Will China overtake the US in technology? It was observed that China’s technology sector is still largely focused on generating profits through incremental innovation based on ideas developed in the US and elsewhere. This does not mean, however, that China’s capacity to out-innovate the US, particularly in the long term, should be underestimated. China’s leadership is highly capable at allocating resources in pursuit of national strategic objectives while playing the long game.
- The sheer size of China’s population also gives it an advantage, in that it provides a ready and huge domestic base to market-test its technologies competitively before exporting them globally. Already, Washington has been caught by surprise at the pace of Chinese technological advances, and reports indicate that China is closing its technological gap with the US faster than expected.
- There is a perception that China’s top-down approach may stifle innovation, but some believe that its centralised system allows China to effectively enhance its investments in science and technology, as well as mobilise national resources to spur technology entrepreneurship. At base, the US-China technological competition also reflects an ideological competition, connecting to the broader question of whether a non-liberal system can succeed over a liberal one.
- Another issue examined was the prospect and implications of a US-China decoupling scenario. American anxieties over China’s growing prowess in technology have increasingly taken on a security dimension, and if this prioritisation of security continues in the US, a degree of decoupling between the two powers would be the logical conclusion.
- It is believed that China does not favour decoupling from the US, although some in China believe that if China plays its cards right over the longer term, the current situation represents an opportunity for China to not just catch up with the US but also reach a position of significant advantage. This is the view that the current competition and threat of decoupling could compel China to make difficult reforms and changes that ultimately enable its economy to become more innovative and competitive.
- Overall, the Chinese do not see the US-China technological conflict as a zero-sum game; it is seen as a negative-sum game where the world at large, including the US and China, would all lose in various ways. Decoupling would result in many areas where China could lose out, including access to American technology, its global market share of hi-tech products, working partnerships with other countries, as well as its stake in the existing international economic system. And although China could scale-back its dependence on US components, any reconstruction of its supply chains as well as the education of a workforce with the requisite skills would take time.
- Concerning the questions of how US-China competition could impact ASEAN and how ASEAN can best respond, it was noted that great power contestation in Southeast Asia is hardly a new phenomenon. The important difference in today’s context, however, is the increased questioning of US There has been a noticeable erosion of US moral leadership while relative American retreat from multilateralism has created a vacuum that needs to be filled. These developments have implications on the peace and prosperity of Southeast Asia, and could compel regional leaders to consider whether the region has reached an inflection point upon which difficult choices would have to be made.
- The possibility of a US-China decoupling scenario is of major concern to ASEAN, particularly since the region’s economic success has been predicated upon market competition and globalisation. Although a diversion of supply chains out of China and toward Southeast Asia could benefit ASEAN economies, over the longer term, sustained protectionism and trade wars would have a severe impact on regional countries and could force them to choose between American and Chinese economic pathways.
- While it has been difficult to achieve any real strategic consensus among member states, there is still potential for ASEAN to exercise greater influence over trade and security developments in Asia. It is incumbent upon ASEAN to exercise flexibility and create the conditions needed to achieve strategic autonomy.
East Asia and Asia Pacific / Event Reports / Global / International Politics and Security / Regionalism and Multilateralism
Last updated on 05/02/2020