U.S. And China Unfolding Technology Decoupling: Impacts, Challenges, And Opportunities For Africa?
Introduction
The Sino-American relations have grown in tension since the onset of the trade frictions in 2017 with a technological war taking place between the two hegemons. Bilateral tensions were further aggravated when the American Administration under Trump adopted radical measures against Chinese telecommunication company Huawei on grounds of threats to national security. The two countries have been engaging in fierce competition in terms of technological development and research, especially regarding cutting-edge industries such as advanced semiconductors, artificial intelligence (AI) and 5G (Kahata, 2020). The continuous contests between China and the United States resulted in the acceleration of technological decoupling; the latter refers to a high degree of bilateral separation (Luo et al., 2020).
This essay will evaluate the impact of the China-US technology decoupling on Africa. Specifically, it will examine the impacts, challenges and opportunities faced by the continent as a result of increased separation between the two giant economies. The next section will further explore the concept of technological decoupling. The subsequent part will primarily focus on the effects of technological decoupling in terms of 5G while the following one will investigate the question from an AI perspective. By contrast, the last section will tackle the effects by addressing the question of advanced semiconductors. Finally, a conclusion will be presented to summarise the essay’s main results and guide future research.
Technological Decoupling
Over the last few years, numerous geopolitical conflicts have erupted between China and the United States with bilateral impositions of tariffs, embassy closures and political discord over the protests in Hong Kong. American decisionmakers have been campaigning against China’s new joint ventures regarding companies that are headquartered abroad, and which want to access national sectors. American leaders, and amongst them former US president Donald Trump, also vowed to reduce the country’s trade deficit and relocate jobs away from China. As of October 2020, there are over 300 China-related bills in the American Congress (Hoecker et al., 2020); this demonstrates the extent of the decoupling between the two countries as well as its multi-dimensional character which includes economic, political and legislative aspects.
Likewise, Chinese authorities, faced with a sluggish economic performance, aim at sustaining gross domestic product (GDP) growth through the development of the technological sector. This shift in focus is motivated by China’s willingness to scale down its dependence on external suppliers, especially in terms of semiconductors as well as software and hardware technology. The Chinese have also strived to reduce their reliance on US technology since the National Security Agency’s (NSA) spying program has been leaked by Edward Snowden. In the long haul, the United States aims at maintaining its position as a tech leader globally; China, on the other hand, holds the ambition to rise to that level. Nonetheless, political considerations and the eminent rise of decoupling are leading global leaders as well as executives in the two countries to change their strategies (Wei, 2019).
The Issue of 5G
The adoption of 5G technology has been primarily driven by the efforts of Huawei, a Chinese technology giant. Nonetheless, the implementation of successive sanctions against the company by the United States has significantly halted the pace of the Asian technology leader. In retaliation, Chinese authorities, through their state-owned media, threatened to act against measures that it deemed to be discriminatory (Doffman, 2020). For the past decade, Huawei has been considered as an important threat to the US national security. In 2018, upon American request, the authorities of Canada arrested Meng Wanzhou, Huawei’s Chief Financial Officer (CFO), for violating US sanctions against Iran. Within that tense context, the Trump administrated also decided to ban the Chinese company from contributing to the installation of 5G networks in the United States.
President Trump has also led a global campaign characterised by diplomatic and political pressures on Germany, Canada, Japan, Australia and the United Kingdom to not allow Huawei to participate in the building of their 5G Networks (Kipgen and Nagal, 2020). From the US’s initiatives against China’s Huawei, it is clear that amidst contests between the two countries, two blocks are emerging. On one side, there is the US-led privacy-wary countries and on the other, there is the Chinese-led block which is eager to encourage the country’s ascension in the tech industry. Ultimately, this reflects the emergence of a digital decoupling between the United States and China, and the transformation of the world into two blocks, one led by China and the second one by the United States.
5G technology is approximately 100 times faster than current networks of 4 and 3G. A shift to 5G represents an important opportunity for the elaboration of other technologies that are relevant for development such as smart cities and driverless cars. Moreover, 5G could significantly advance military operations. Up to now, African governments refused to comply with US-led measures to restrict the contribution of Huawei, as a result Africa could be an early adopter of the technology, hence benefiting from it sooner than most other countries and regions in the world. In fact, the Chinese giant has elaborated data networks for the vast majority of African nations and South Africa has already launched its 5G services in collaboration with Huawei (Delport, 2019).
Additionally, Africa’s refusal to comply with calls from the United States to limit the global rise of Huawei demonstrates that the continent chose to be part of the Chinese-led block, at least from a technological decoupling perspective. Although early adoption of 5G by Africa could represent serious economic and political opportunities, there are fears that the technology would be exploited for unfair political objectives. In 2019, reports surfaced on Huawei’s role in facilitating the spying on political opponents in Africa (Parkinson et al., 2019). Moreover, given Africa’s weak economic performance, Huawei’s operations are most likely going to be supported by funds from the Chinese government (SAIIA, 2020), hence raising issues of conflict of interests and a possible instrumentalization of 5G to help China further grow globally. The decoupling between the United States and China represents an opportunity for Africa to restructure its relationship with the two superpowers in a non-aligned manner. To do so, African nations could rely on Israel’s example. The authorities of the Middle Eastern country are performing a difficult balancing act amidst tense Sino-American relationships. While Israelis responded positively to the US’s warnings by disqualifying Chinese companies from participating in the development of 5G infrastructure (Segev, 2020), they also strengthened their ties with China by granting Haifa’s port management to Chinese firms (Dorsey, 2020).
Artificial Intelligence (AI)
Over the last few years, the United States has been paying close attention to China’s rise in the field of artificial intelligence for two fundamental reasons. First artificial intelligence has serious implications on state power, especially in terms of military capability and economic growth. Second, it is expected that leaders and pioneers of AI will have a comparative advantage in setting norms in terms of usage, and will therefore be able to influence undecided countries (Wladawsky-Berger, 2018). According to Accenture Research, which conducted a study on 12 developed economies, Artificial Intelligence has the potential to double yearly economic growth by 2035 and can result in a 40 percent increase of labour productivity (Purdy and Daugherty, 2017).
Both China and the United States recognise the revolutionary character of AI, militarily speaking. The US Department of Defence admits that advances in AI will lead to societal changes and transform the character of war (U.S. Deputy Secretary of Defence). China, on the other hand, has vastly recognised the potential of AI, President Jinping even called the military to intensify its research in the field in preparation of a future war (Johnson, 2018). In retaliation, the United States scaled up its AI research and established the Defence Innovation Board to oversee the ethical aspect of using artificial intelligence for armed conflict. Also, the US created a Joint Artificial Intelligence Centre to establish standards and share information and expertise regarding Artificial Intelligence. Efforts in terms of developing AI in China and the United States are largely divergent, they echo with the space race which unfolded between the USSR and US amidst the Cold War and transcribe a tendency of technological decoupling between the two superpowers.
In addition to its use in warfare, AI has numerous applications in terms of policy through facial recognition systems, for example, which are used for surveillance. The Carnergie Endowment for International Peace found that 75 countries of a total of 176 surveyed are already using AI technology actively for surveillance operations (Feldstein, 2019). The report also demonstrated that African nations are lagging behind in terms of AI technology adoption, with less than one-quarter of Sub-Saharan countries investing in AI technology. According to Feldstein (2019), this lack of investment can mainly be attributed to the fact that the region suffers from endemic underdevelopment, especially in terms of technological infrastructure. Nonetheless, Chinese authorities are encouraging African countries to buy their equipment by offering loans, for example, and vowing to assist these countries with the management of AI technologies in the long-term. In recent times, Chinese developer CloudWalk announced a deal with Zimbabwe’s authorities to launch a facial recognition system in the country (Dahir, 2019). The announcement led to a violent wave of critics especially from human rights’ advocates who believe that equipping autocracies with advanced technologies will further sustain their efforts to hog onto power and help them violate civil liberties. Similarly, the United States has also been under attack for using technology to spy on foreign countries (Miller, 2020)
Overall, tech decoupling between the US and China can stimulate the development of AI technology, which in turn can help the economic development of Africa conditional on sound adoption and a predicted increased productivity of the manufacturing sector. Nonetheless, AI technology is largely complementary with other infrastructure, hence, African nations will need to invest extensively in the latter to be able to benefit from AI take-up. It is also worth noting that improper use of AI technology could further exacerbate human rights’ violations on the continent, hence producing a negative impact from a humanitarian perspective.
The Role of Semiconductors
Semiconductors are also referred to as microchips or integrated circuits, they are made from elements such as germanium or silicon as well as other compounds like gallium arsenide. These materials are usually mixed with a small volume of impurities to produce a higher level of conductivity; this process is known as doping (Semiconductor Industry Association, 2021). Semiconductors are a crucial element for the manufacturing of electronic devices and the development of new technologies, in general. As of 2020, 70 percent of semiconductors were manufactured or transited through the island of Taiwan (Slingerland, 2020). To halt China’s rise and avoid possible dependence and alienation, the United States vowed to transform the global supply chain of semiconductors to ultimately gain control. By doing so, the United States has been said to engage in “semiconductor nationalism” (Liu, 2020, p.1).
To address the intensification of American tech protection, China decided to shift its strategy by adopting an anti-globalisation stance which consists of enhancing independent development at the expense of global integration. This is especially relevant for companies operating in the Chinese semiconductor sector which have witnessed a decrease in operations since the Trump administration launched a trade war against China. Amidst rising semiconductor nationalism, Chinese companies are concerned that declining bilateral cooperation will result in higher exposition to risk, hence, the assistance of the government and the emergence of technological decoupling between the two giants is unavoidable (Capri, 2020).
The willingness of the United States to emerge as a global leader in the semiconductor industry provides an outstanding opportunity for African leaders to penetrate the market and supply the United States with necessary primary materials. It also highlights the decoupling between the United States and China in the sector and outlines the growing independence of China and the possible development of two strong blocks in the industry. This could have serious implications for global supply chains and provide a chance for African countries to diversify their economies and generate an income by expanding the global market. Nonetheless, it is important that the relevant authorities consider possible second-degree effects that their economic relations which the United States may have on Chinese and African cooperation. This is especially true considering the support that China offers to Africa.
Conclusion
This essay evaluated the impacts, challenges and opportunities faced by Africa as a result of the China-US technology decoupling. The first section explained the phenomenon of technology decoupling within the context of the US-Chinese relations and outlined the underlying reasons that led to a decline of integration between the two superpowers. The second section investigated the impact of this decoupling on Africa from a 5G perspective; this was primarily achieved by considering the case of Chinese telecommunication giant Huawei. It was observed that Africa could benefit economically from the adoption of Chinese 5G technology. Nonetheless, most African nations fall short in terms of funds to invest in such technology and have to rely on support from Chinese authorities; this in turn, raises questions of intrusion and instrumentalization from China.
Likewise, it was observed that there is strong decoupling between the US and China in terms of Artificial Intelligence development and that there are increasing concerns over the possible uses of this technology. This is especially true given that many countries already exploit AI for surveillance. African countries were found to be lagging behind in terms of take-up mainly due to their overall level of underdevelopment in technology. Finally, the recent rise in “semiconductor nationalism” in the United States highlights another aspect of technological decoupling. The ambition of the United States to occupy a leadership status in the industry represents an outstanding opportunity for African nations to penetrate the market and increase their cooperation with American companies, hence generating income. Nonetheless, African nations must be cautious not to undergo such cooperative ventures with ideological motives that can be interpreted as conflictual with China.
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