GZERO Media logo

US-CHINA TRADE: BACK TO THE FUTURE

US-CHINA TRADE: BACK TO THE FUTURE

The US-China trade confrontation will soon enter a new phase, as Washington looks set to unveil new investment restrictions designed to stop strategic technologies from falling into Chinese hands. Last week, we asked whether the Trump administration was prepared to fire its big guns in the trade spat — $200 billion worth of tariffs. But the more consequential fight, for both countries, isn’t about trade, it’s about ownership–specifically, who controls artificial intelligence, advanced robotics, and other the technologies of the future.


While the Treasury Department had been widely expected to announce new investment restrictions this week, it now looks like Congress might take the lead, with less certainty around timing. Either way, the result will be a new form of pressure on China.

Here’s what makes this next phase of the US-China spat different:

The future matters more than the past. The Trump administration’s technology tariffs (see graphic below) are meant to compensate for what the US considers to be China’s long history of technology theft and unfair trade practices. By nature, they’re backward-looking. The new investment regime, in contrast — which encompasses both new limits on Chinese investment in the US and potentially heightened government scrutiny of US high-tech exports — is aimed at stopping future transfers of “industrially significant technology” from the US to China. Even if the Washington and Beijing can reach a truce on tariffs, the investment restrictions are likely to linger. They may even become permanent.

Concentrated pain. The new investment regime will target high-tech industries that Chinese President Xi Jinping considers vital to cementing his country’s power and prestige in the 21st century. Beijing will look to retaliate by making life harder for US companies in China, but China’s dependence on the US for key components like cutting-edge semiconductors mean it will feel real, unavoidable pain.

The big picture: This is an irresistible-force-meets-immovable-object situation, where both sides will be reluctant to cave, and the global tech sector risks getting caught in the middle.

Carbon has a bad rep, but did you know it's a building block of life? As atoms evolved, carbon trapped in CO2 was freed, giving way to the creation of complex molecules that use photosynthesis to convert carbon to food. Soon after, plants, herbivores, and carnivores began populating the earth and the cycle of life began.

Learn more about how carbon created life on Earth in the second episode of Eni's Story of CO2 series.

On September 23, GZERO Media — in partnership with Microsoft and Eurasia Group — gathered global experts to discuss global recovery from the coronavirus pandemic in a livestream panel. Our panel for the discussion Crisis Response & Recovery: Reimagining while Rebuilding, included:

  • Brad Smith, President, Microsoft
  • Ian Bremmer, President and Founder, Eurasia Group & GZERO Media
  • Jeh Johnson, Partner, Paul, Weiss, Rifkind, Wharton & Garrison, LLP and former Secretary of Homeland Security.
  • John Frank, Vice President, UN Affairs at Microsoft
  • Susan Glasser, staff writer and Washington columnist, The New Yorker (moderator)

Special appearances by UN Secretary-General António Guterres, European Central Bank chief Christine Lagarde, and comedian/host Trevor Noah.

More Show less

62: In a referendum over the weekend, nearly 62 percent of Swiss voters said they wanted to preserve freedom of movement between the European Union and Switzerland, which is not a member of the EU. The right-wing Swiss People's Party had proposed imposing migration quotas at the border, saying that the current frontier is basically a... (okay, they didn't actually say it's a "Swiss cheese" but still).

More Show less

Carl Bildt, former Prime Minister and Foreign Minister of Sweden, shares his perspective on the Navalny poisoning on Europe In 60 Seconds:

Can Europe get to the bottom of Russian opposition leader Navalny's poisoning? And if so, would it change anything?

One has got to the bottom of it, to certain extent. The evidence, there was a German laboratory confirming nerve agent, Novichok. They sent it to a French laboratory and the Swedish independent laboratory, they came to the exact same conclusions. I mean, it's dead certain. He was poisoned with an extremely poisonous nerve agent coming from the Russian state laboratories. Now, there is a discussion underway of what to do. I mean, the Russians are refusing any sort of serious discussions about it. Surprise, surprise. And we'll see what actions will be taken. There might be some sort of international investigation within the context of the OPCW, the international organization that is there, to safeguard the integrity of the international treaties to prevent chemical weapons. But we haven't seen the end of this story yet.

Watch as Nicholas Thompson, editor-in-chief of WIRED, explains what's going on in technology news:

Would Facebook actually leave Europe? What's the deal?

The deal is that Europe has told Facebook it can no longer transfer data back and forth between the United States and Europe, because it's not secure from US Intelligence agencies. Facebook has said, "If we can't transfer data back and forth, we can't operate in Europe." My instinct, this will get resolved. There's too much at stake for both sides and there are all kinds of possible compromises.

More Show less
UNGA banner

GZEROMEDIA

Subscribe to GZERO Media's Newsletter: Signal

Panel: How will the world recover from COVID-19?

UNGA Livestream