What the Huawei Case Can Teach Us about the US-China Power Game

In a debacle referred to as the “end of global tech” and the dawn “of the next global recession,” U.S. officials banned Huawei by adding it to the “Entity List.” With this designation, Huawei was “cut[] off from its U.S. suppliers,” “affect[ing] global supply chains.” The destructiveness of this designation aside, the dispute mirrors a “larger power game between the United States and China.” On the surface, this action appears to harm China the most, but actually “bring[s] disastrous consequences to the international order…, [and] might hurt the United States even more than China.” The economic framework of the U.S. is rooted in respect for free markets, intellectual property, and cooperative “innovation economies”; President Trump’s ban is directly at odds with this fact. More importantly, however, the ban undermines “bilateral U.S.-China relations,” making China’s “innovation ecosystem” more attractive than the American one.
Given these adverse effects, actors within both governments have many realistic options to alleviate tensions. Firstly, both governments should shift to “appreciat[ing] the peaceful competition and cooperation between the two economies,” which has resulted in a highly entangled economic structure. Secondly, rather than falling prey to “hawkish voices,” the U.S. should listen to “rational risk assessment, such as those that European companies are completing.” Finally, the two nations should engage in “trust-building mechanisms” to hasten the development of a global regime for controlling emerging technology. Though this conflict is just one single episode in an increasingly tense relationship between the United States and China, it underscores larger opportunities for cooperation between the two states.