China’s technology sector is in danger of being “strangled” by the United States and its allies, according to Chinese General Secretary Xi Jinping.
“We must quicken the pace of tech self-reliance to prevent being strangled by foreign countries,” the Chinese Communist Party leader told the party Politburo this week.
A long-term bipartisan effort to prevent China from gaining crucial advantages over the U.S. and its allies. Those multipronged efforts have given rise to discussions about a multinational initiative to restrict Western technology exports to China.
“Only by accelerating the construction of a new development pattern can we consolidate the foundation of our economic development, enhance security and stability, and improve our viability, competitiveness, development power, and sustainability in foreseeable and unpredictable storms,” Xi said, per a South China Morning Post translation.
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Supply chain anxiety has become a point of consensus between Beijing and the U.S. alliance network, as neither side wants to depend on the other for critical technology or resources. The U.S. and the European Union have launched a Trade and Technology Council in conjunction with U.S. efforts to coordinate with Japan against Beijing’s “unfair and opaque use of economic influence,” as the allies put it last year.
“I have no doubt that China will inevitably begin to reduce this dependence and has already begun to scale it down,” Russian Foreign Minister Sergey Lavrov said Thursday, per Russian state media. “The process of not just discussing, but finding ways to form new mechanisms has gotten off the ground, and it is going in the direction of, you might say, the fragmentation of global mechanisms.”
Those deepening suspicions reportedly have spurred talks between the Biden administration and a pair of allies home to the companies that lead the market for machinery needed to make advanced semiconductor chips.
“We can’t talk about the deal right now,” U.S. Deputy Commerce Secretary Don Graves said Tuesday. “But you can certainly talk to our friends in Japan and the Netherlands.”
Their coordination with the U.S. has the potential to constrain China’s ability to produce its own advanced microchips.
“That has put China in an increasingly difficult position in which its companies might not have access to the fastest and most power-efficient chips, which has implications for consumer markets, like cellphones,” the American Enterprise Institute’s Zack Cooper told the Washington Examiner. “It has implications in other areas, too — like datacenters that are important for artificial intelligence.”
Xi wants China “to become a global leader in important scientific and technological fields, a pioneer in cutting-edge interdisciplinary areas, and a major scientific center and innovation hub for the world.”
But his commenters to the Politburo study group raise a question about the likelihood of success in that project, according to Cooper.
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“I think what you’re seeing is China worrying that it's going to be cut out of some of the most cutting-edge work in those areas if it can’t access, especially, the microprocessors that it needs,” Cooper said.