DAVOS, Switzerland: China and the United States may have laid down their arms for now in a trade truce, but their technological rivalry is still raging, raising the spector of a high technology cold war.
The coming battle played out this week in the corridors of the World Economic Forum in
Davos, where Chinese executives rubbed shoulders with Silicon Valley supremos, and US diplomats lobbied hard to keep companies from embracing “Made in China” for their tech revolution.
At the center of this cold war 2.0 is Huawei, the Chinese telecommunications giant whose Fifth Generation (5G) technology is key to delivering artificial intelligence (AI) and the next generation of computing.
Despite the idyllic winter setting, the tensions over Huawei between Beijing and Washington couldn’t be higher.
Huawei has been banned from America, which insists on the risk of Chinese espionage and implores its European allies to do the same as the company rolls out deals in major emerging markets led by Brazil and India.
Making matters personal, company founder Ren Zhengfei, a Davos star this year, came to the snowy resort just as his daughter, the company’s chief financial officer, was being grilled in Canada for extradition to the US where she is wanted on charges of fraud and breaking US sanctions against Iran.
“A world divided? I don’t believe it,” Ren told to an audience of chief executive officers and top executives, avoiding all controversy.
But experts assessing this new battleground warn the world is entering a digital schism.
“There is a competition for the predominance globally on digital questions. Huawei is a symbol of that but it runs much deeper,” Carlos Pascual, a former US diplomat and vice president of IHS Markit, told Agence France-Presse.
For Pascual, cyberconflicts and “battles of influence” are paving the way for “a major Sino-American confrontation.”
The confrontation ratcheted up in 2015, when Beijing adopted the “Made in China 2025” program to boost its technologies, along with a massive infrastructure investment plan for the “Silk Roads” to Asia, Europe and Africa.
“This could lead many developing countries to look to China to build their telecom networks, relay stations, data centers and government IT (information technology) systems,” said John Chipman, head of the International Institute for Strategic Studies.
He noted that, as they expand across all continents, Chinese companies are also gaining access to troves of data, the key to developing AI and the foundation for tomorrow’s economy.
Irked by this data harvesting, Washington has also blacklisted several Chinese cybersurveillance and facial recognition firms.
Meanwhile, Chinese internet giants Baidu, Alibaba and Tencent, pushed by Beijing, are developing AI platforms, autonomous cars or connected objects distinct from those developed in Silicon Valley by Google or Amazon.
“The concern is that there will be two types of systems that are not compatible. Technology is an issue of power and a bipolarization is taking place,” said Jacques Moulin, head of the European think tank Idate.