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Yao Yang: China-US Tech Rivalry to Intensify

Jul 09-2020   



In 2008, the financial crisis saw trade protectionism and deglobalization rear their heads; In 2018, the escalation of trade frictions between China and the US once again brought the contentions over global order into the limelight; In 2020, the outbreak of the pandemic has been adding fuel to arguments over deglobalization, re-casting of industrial chains, and US-China decoupling, and has also become an important variable impacting on capital markets and asset allocation worldwide.

 

“The so-called ‘decoupling’, in my view, primarily takes place in the technological sphere between China and the US, namely the US has been digging trenches to limit technological export to China,” said Prof. Yao Yang, Dean of the NSD, in his keynote speech for an online forum by Caijing Magazine and Barron’s Chinese edition. “However, even in the technological arena, it’s unlikely that two parallel systems will come into being.”

 

Held on June 18th, the forum centered around the theme ‘New Opportunities in Re-casting of Industrial Chains in Post-pandemic Era”. Prof. Yao spoke on the creation of an open and mutually-inclusive innovation system.

 

He believed that the supply chains are temporarily disrupted by the pandemic but most of them will be back up working when the pandemic ends. In the tech arena, the most important issue is the drafting of standards which are led by leading companies and from which the US cannot exclude China. China should aim to join rules-based competitions, of which the prerequisite is to allow the market to play a decisive role in resource allocation. Only so will a global innovation order characterized by openness and shared prosperity be built to the benefit of China.

 

Prof. Yao debunked some people’s belief that the US is giving up the leadership of the world. Rather, he said, the US is simply trying to lead in another way by re-molding a world system in which the members – predominantly small countries – will kowtow to its interests and its allies will be required to act reciprocally, e.g. in military budgets.

 

President Trump’s actions can be deemed as inflicting damages on the world system. Yet not only should China implement its first-phase deal with the US, it should also take advantage of the second-phase negotiations, which will focus on rules, to get involved in the making of international rules as the US might apply such rules to reform the WTO.

 

Against the backdrop of a new-type Cold War between China and the US, the tech rivalry between the two countries is actually one between China and the Western world and can only intensify in the future. Yet the rivalry should take place within a unified framework. For China, the goal should be to join rules-based competitions and make its share of contributions to such a competitive landscape.

Yao Yang: China-US Tech Rivalry to Intensify

Jul 09-2020   



In 2008, the financial crisis saw trade protectionism and deglobalization rear their heads; In 2018, the escalation of trade frictions between China and the US once again brought the contentions over global order into the limelight; In 2020, the outbreak of the pandemic has been adding fuel to arguments over deglobalization, re-casting of industrial chains, and US-China decoupling, and has also become an important variable impacting on capital markets and asset allocation worldwide.

 

“The so-called ‘decoupling’, in my view, primarily takes place in the technological sphere between China and the US, namely the US has been digging trenches to limit technological export to China,” said Prof. Yao Yang, Dean of the NSD, in his keynote speech for an online forum by Caijing Magazine and Barron’s Chinese edition. “However, even in the technological arena, it’s unlikely that two parallel systems will come into being.”

 

Held on June 18th, the forum centered around the theme ‘New Opportunities in Re-casting of Industrial Chains in Post-pandemic Era”. Prof. Yao spoke on the creation of an open and mutually-inclusive innovation system.

 

He believed that the supply chains are temporarily disrupted by the pandemic but most of them will be back up working when the pandemic ends. In the tech arena, the most important issue is the drafting of standards which are led by leading companies and from which the US cannot exclude China. China should aim to join rules-based competitions, of which the prerequisite is to allow the market to play a decisive role in resource allocation. Only so will a global innovation order characterized by openness and shared prosperity be built to the benefit of China.

 

Prof. Yao debunked some people’s belief that the US is giving up the leadership of the world. Rather, he said, the US is simply trying to lead in another way by re-molding a world system in which the members – predominantly small countries – will kowtow to its interests and its allies will be required to act reciprocally, e.g. in military budgets.

 

President Trump’s actions can be deemed as inflicting damages on the world system. Yet not only should China implement its first-phase deal with the US, it should also take advantage of the second-phase negotiations, which will focus on rules, to get involved in the making of international rules as the US might apply such rules to reform the WTO.

 

Against the backdrop of a new-type Cold War between China and the US, the tech rivalry between the two countries is actually one between China and the Western world and can only intensify in the future. Yet the rivalry should take place within a unified framework. For China, the goal should be to join rules-based competitions and make its share of contributions to such a competitive landscape.