Time to end reliance on developed countries for high-tech products

THE UNITED STATES COMMERCE DEPARTMENT has banned US companies selling parts, commodities, software and technology to ZTE up until March 13, 2025. Qianjiang Evening News commented on Wednesday:

This is actually the latest development in the US government crackdown on ZTE, as the investigation has lasted for years. Once the embargo is put in place, it will cause serious loss for not only ZTE, but also other enterprises down its industrial chain. It will also set back the progress of the 5G net.

ZTE, which has cooperation with hundreds of US companies, has created tens of thousands jobs for the US. Imposing sanctions against ZTE will inflict heavy losses upon the US enterprises as well. No wonder, the stock prices of these US enterprises fell immediately after the US Commerce Department announced its decision.

The move should be regarded as part of the US tactics in its trade friction with China. Targeting technology is like throttling the neck of the Chinese enterprises. It highlights China’s weakness in high technology, particularly its reliance on developed

countries for high-tech products.

It is China’s recent breakthroughs in science and technology, if not its ambition to become a competitor with the US in high-tech and advanced manufacturing industries in the foreseeable future, that have worried the US. Washington does not want to be merely a docile witness, without doing anything, to China’s rise in the high-tech arena, which will shake the foundation of the US’ role as the top player in the global economy.

The ZTE case should remind China’s decisionmakers of the urgency to become self-sufficient in core technologies.

The chips and parts imported from the US in the warehouse of ZTE are enough to sustain its production for one to two months, which should serve as a window of opportunity for Beijing and Washington to strike a deal to avoid a lose-lose situation.