The latest casualty is TikTok, a video app that is popular with teenagers and which has hundreds of millions of devoted fans across markets such as India and the United States. The app is owned by a Chinese company, but run by an American CEO
The first major hit came last month, when TikTok was blocked in India
after a heated border clash with China left at least 20 Indian soldiers dead. Then, on Monday, US authorities said they would look at banning the app
because they consider it a possible threat to national security. That news broke as the company said it would leave Hong Kong
because of concerns over a sweeping national security law China imposed on the city.
“It is becoming harder to be a truly global tech platform,” said Dipayan Ghosh, the co-director of the Digital Platforms and Democracy Project at the Harvard Kennedy School.
The fight right now between the world’s two largest economies cuts to the heart of that issue. The United States and China are competing
over artificial intelligence, super-fast 5G mobile networks and other technology. Although the countries have long-running economic ties that enable some collaboration, recent tensions over national security have pushed their governments and businesses to reconsider those partnerships.
The conflict is bleeding over into the relationships those countries have with other global powers, too. The United Kingdom, for example, is re-examining its decision to grant Chinese tech company Huawei the ability to help build the country’s 5G network. That review comes after the United States, which has repeatedly targeted Huawei, imposed sanctions on the company that could prevent other firms from supplying it with the chipsets it needs to build its next-generation technology.
“My impression is that the tech companies are only now waking up to the fact that life in the future is going to be a lot less globalized,” said Michael Witt, a senior affiliate professor of strategy and international business at INSEAD, the international business school. “They are really on the horns of a dilemma.”
A bitter rivalry
The United States and China have for decades held opposing views on how to wield technology. While IBM (IBM
) and Microsoft (MSFT
) were driving American innovation in the 1980s, China was laying down the foundation
for its Great Firewall — a massive censorship mechanism that shuts out content widely available elsewhere on the internet. In the years since then, China has created a closed and controlled internet that has found fans among other authoritarian countries: Russia, for example, has moved to restructure and rein in its once freewheeling internet with the assistance of Chinese tech
China’s investments in technology have grown even more rapidly in recent years because of “Made in China 2025,”
Beijing’s ambitious plan to shed the country’s reliance on foreign tech
by spending billions of dollars in areas such as wireless communications, microchips and robotics. (Last year, for example, the country imported $306 billion worth of chipsets
, or 15% of the value of the country’s total imports.)
The United States has responded by seeking to limit China’s advance.
The Trump administration has accused China of stealing US technology, an issue central to the damaging trade war that has colored the relationship between the two since 2018. Chinese officials have repeatedly denied such allegations and argued that any tech secrets handed over were part of deals that had been mutually agreed upon. The United States has also imposed sanctions
on prominent Chinese tech firms
and taken steps to limit Beijing’s access to America’s vast capital markets
As Washington escalates its fight against Beijing, international technological cooperation looks increasingly likely to disappear.
“Beijing has concluded that decoupling is inevitable,” wrote Ian Bremmer and Cliff Kupchan, the president and chairman of Eurasia Group, in a report published earlier this year
that noted how Chinese President Xi Jinping is calling for the country to break its technological dependence on the United States.
“China will expand efforts to reshape international technology, trade, and financial architecture to better promote its interests in an increasingly bifurcated world,” they wrote.