Washington and Beijing's hi-tech rivalry is expected to continue and even intensify, regardless of who wins the US presidential election, according to analysts who say the tone for further strained US-China relations has already been set.

Former president Donald Trump's boast that he took "billions and billions of dollars" from China through tariffs on a wide variety of Chinese imports, including hi-tech products, suggest that higher duties could be on the way if he wins the White House.

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Meanwhile, Vice-President Kamala Harris has promised to make sure "that America - not China - wins the competition for the 21st century and that we strengthen, not abdicate, our global leadership".

The approaches of the candidates may differ but the tech competition between China and the US will continue to weigh heavily on the international economic and geopolitical landscape, analysts said.

"Breakthroughs in science and technology will be central to the geopolitical landscape of the 21st century and to efforts by the US and China to dominate it," said Sourabh Gupta, a senior policy specialist with the Institute for China-America Studies in Washington.

"To be clear, there is no 'new cold war' that is about to break out as yet in US-China relations [of] the sort of overarching zero-sum rivalry that played out between Washington and Moscow during the second half of the 20th century," Gupta said.

"However, there is a palpable cold war-style, zero-sum equation settling into their competition to dominate the high-technology and advanced manufacturing industries of tomorrow."

The US has been tightening its grip on technology transfers with China for years, denying market access to Chinese tech products and cracking down on technology-related investments in both directions.

Former US president and Republican presidential nominee Donald Trump claims to have taken "billions and billions" of dollars in tariffs from China. Photo: EPA alt=Former US president and Republican presidential nominee Donald Trump claims to have taken "billions and billions" of dollars in tariffs from China. Photo: EPA>

Telecoms equipment giants Huawei and ZTE were banned from the US during the Trump administration because of alleged links to the Chinese government and military.

Sales of advanced chips and chip-making equipment to China by the US and its allies have also been banned on national security grounds.

Chinese President Xi Jinping has repeatedly emphasised the importance of technological self-reliance and the development of home-grown industries of the future, including AI and quantum computing, to keep China in the global tech race.

Analysts expect Harris to stick with President Joe Biden's "small yard, high fence" approach to China if she wins in November. The strategy puts strict restrictions on a few military-related technologies while maintaining normal economic exchanges in other areas.

But the same semiconductors that are subject to export controls because of their use in advanced artificial intelligence models, weapons and surveillance systems are also used in autonomous vehicles, 5G-connected phones, and commercial applications of AI.

The Biden administration has also barred hundreds of Chinese companies from importing almost all US-origin products from the US and its allies and introduced inbound and outbound investment screening if tech firms are involved.

Harris is also expected to raise the fencing over computing-related technologies, biotech and clean tech - areas singled out by the Biden administration as a "national security imperative" for the US to hold its leadership position.

US Vice-President and Democratic presidential candidate Kamala Harris has promised to ensure "America - not China - wins the competition for the 21st century". Photo: AFP alt=US Vice-President and Democratic presidential candidate Kamala Harris has promised to ensure "America - not China - wins the competition for the 21st century". Photo: AFP>

The US House of Representatives passed 25 laws in just one week of September, in a largely bipartisan push to limit China's influence by restricting access to China-linked biotech companies, China-made drones and even Chinese electric vehicle components.

Wu Hailong, president of the semi-official China Public Diplomacy Association, warned that the "anti-China bills could potentially push the Sino-US relationship into a dangerous position once again".

The latest bills follow the Chips and Science Act, enacted in August 2022, that set aside US$53 billion to fund American semiconductor production and research and was hailed by the White House for "protecting national security" as well as "bringing semiconductor supply chains home".

According to Pang Zhongying, chair professor in international political economy at Sichuan University in Chengdu, "there is already a complete set of rules and regulations to curb China's technological development".

"If Harris is elected, policy continuity will be the main theme, though she may show her own preference later, if she has a second term," he said.

If Trump is returned to the presidency, he is likely to tilt towards a "smaller government", reduce industry subsidies and resort to trade tariffs again as a bargaining tool, Pang said.

Trump has recently called for up to 20 per cent tariffs on all imports and 60 per cent on Chinese goods, prompting many experts to predict that a second Trump presidency would be more confrontational towards Beijing.

In 2018 and 2019, the Trump administration imposed four rounds of tariffs on about two-thirds of US imports from China, after an investigation found China's practices related to technology transfer, intellectual property and innovation were "unreasonable or discriminatory and burdened or restricted US commerce".

"The silver lining [for China] may be Trump's attitude towards American allies. After all, not all companies in other countries are willing to abandon the massive market of China," Pang said.

The Biden administration has been pressing US allies - including the Netherlands, Germany, South Korea and Japan - to tighten restrictions on China's access to semiconductor technology.

However, Trump, an "America First" advocate, is dubious about alliances and has been a vocal critic of world organisations such as Nato.

There are also concerns in Europe that a victory for Trump in November could mean a decline in US aid to Ukraine.

Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, said that while their approaches may vary, both candidates intend to press ahead with technology curbs on China.

According to Mei, the confrontation is likely to reach a peak during the next US president's four-year tenure.

"During that period, China's focus will be on technological development. It will spare no effort to innovate and industrialise innovation results as soon as possible by taking advantage of its economic scale."

Beijing has pumped nearly 690 billion yuan (US$97 billion) into the chip industry since 2014, in its bid to be able to mass produce its own advanced chips, and is also pursuing a bigger say in global AI governance.

China has also doubled down on its efforts to persuade the many leading Chinese scientists overseas to return home and train domestic talent in the emerging hi-tech industries.

In June, Xi wrote to world-renowned computer scientist and AI expert Andrew Yao Chi-Chih, the only Chinese winner of the AM Turing Award, to praise his decision to leave the US two decades ago to teach at Tsinghua University.

Xi urged Yao - who heads the university's Institute for Interdisciplinary Information Sciences and the new College of Artificial Intelligence - to continue helping China achieve self-reliance and become an educational, scientific and technological powerhouse.

According to Richard Suttmeier, a University of Oregon researcher looking at science and technology in the context of US-China relations, "in many ways, the current situation is one of lose-lose for both countries".

"China's commitment to high levels of self-reliance in science and technology development, in spite of numerous international ties, puts it somewhat at odds with global trends," he said.

"US efforts to build a network of cooperation in science and technology among democracies will have some national and international benefits in the shorter run, but as a strategy that attempts to isolate China's emergence as a science and technology superpower, is likely to run into big problems over the longer run."

Six of the top 10 rising institutions in artificial intelligence between 2019 and 2023 were in China, but they remained relatively decoupled from US-led global collaboration networks, according to the latest Nature Index.

The AI index, compiled by part of the group that owns the British journal Nature, found that China's global connectivity is lagging behind the US - the leading AI research nation - as well as Britain and Germany.

According to Michael Frank, chief executive and founder of business intelligence platform Seldon Strategies, the US-China relationship has settled into a new equilibrium that will persist for a long time.

"Tactics may change, but the US strategy of limiting technology transfer to China, and the Chinese strategy of achieving technological self-sufficiency, are fixed," he said.

"Many countries are wary of being forced to choose between the US and China. Even if the competitors don't make those demands explicitly, global companies will have to make a decision between which ecosystem to prioritise."

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2024 South China Morning Post Publishers Ltd. All rights reserved.

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