The Ongoing Sino-US Trade War and Subsequent Tech War

René W.H. Linden () and Piotr Łasak ()
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René W.H. Linden: The Hague University of Applied Sciences
Piotr Łasak: Jagiellonian University

Chapter Chapter 8 in Financial Interdependence, Digitalization and Technological Rivalries, 2023, pp 93-102 from Springer

Abstract: Abstract The Sino-US trade war and the ensuing technological war (2018–2023) with the associated increase in all kinds of trade-restricting measures has several causes and consequences. One of the US complaints in this regard concerns the protracted US trade deficits that have been partly caused by the “currency manipulation” of an undervalued RMB against the USD that is partially tied to the value of the USD. In addition, a lower standard of living in China has led to lower wages, but this argument is less and less valid in a more prosperous Chinese economy. Also, the surge in Chinese imports to the US has led to increased unemployment in declining US manufacturing industries that have not sufficiently grown and then unable to compete on a global scale in the past two decades. One of the bigger complaints that has fueled discussions about recent US–China trade disputes for some time is US allegations that Chinese companies are stealing or misusing intellectual property rightsintellectual property rights from US companies. For the last few years, the US has increasingly accused China of not only unfair trade practices such as intellectual property theft, but also forced technology transfers, lack of market access for US companies in China, and creating an uneven playing field through state subsidies from Chinese state-owned companies. The current tech war between China and the US began as a trade dispute, but quickly turned into a battle for leadership in technological dominance in core technologies such as 5G, artificial intelligence, and semiconductors. The key to this is the emerging digital state-led high-tech authoritarianism with mass surveillance supported by the use of Big Data and China's 5G technology, which is seen as a threat to the US. The US, with its long history of technological development, has been the global technology leader for decades, but that position is now being challenged by China, which has made massive efforts to catch up with the US with tens of billions in state funding.

Keywords: Sino-US trade war and subsequent tech war; First Phase One trade agreement; Global supply chains; Currency manipulation; State capitalism; WTO commitments; Declining industries; Comparative advantage; Intellectual property rights; Forced technology transfer; “Chip war” (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/978-3-031-27845-7_8

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