China could do without exports to America
A new battle of the systems has begun, one could almost say it is a battle of the operating systems: on the one hand, authoritarian-led China, on the other, the USA. But instead of ideology, this "cold war 2.0" is primarily about technology. US President Donald Trump has ordered that American companies are no longer allowed to sell to the Chinese company Huawei. Soon there will be no more operating systems from Google for Chinese smartphones, and the expansion of the 5G cellular standard is at risk because no more chips are being supplied. The global supply chains are the future lines of conflict.
The mutual economic dependency is the big difference to the Cold War. There was no significant economic exchange between the United States and the Soviet Union. Less than 0.25 percent made the trade with the rival on the US balance sheet. In China it is 13 percent today. The Chinese and American economies are closely intertwined. For decades, that was exactly what was considered a prime example of globalization: The People's Republic was the workbench of the world, the ideas and the semiconductors came from the USA. However, this division of labor is increasingly questioning China's rise, Chinese companies are entering the world market, and this competition is not always fair. Companies are subsidized by the state, industrial espionage is promoted, and the Chinese leadership consistently blocks its own market. President Trump is now trying brute force.
While Google and American chipmakers were just announcing that they would no longer deliver to Huawei, China's all-powerful state and party leader Xi Jinping demonstratively visited a mine in the hinterland where rare earth metals are extracted. These are the 17 metals that are essential for a smartphone, the elements and their connections are built into the antennas, as well as in the batteries, even electric cars cannot drive without these metals. China is by far the largest sponsor, and an export ban would hit the global economy considerably. It would be the next level of escalation.
This is exactly what the Chinese people are sworn to do. State television changed the program at short notice in the past few days. At prime time, there were suddenly propaganda strips from the 1950s and 1960s that hadn't been shown for years. "The Battle of Shangganling", for example, shot in 1956: a unit of the People's Liberation Army bravely holds the position against seemingly overwhelming American troops in the Korean War.
The Chinese leadership does not seem to be afraid of a long-lasting conflict, also because they consider their own political operating system to be more crisis-proof. While President Trump is snapping at the US central bankers via Twitter and urging them in vain to lower the key interest rate, one instruction is enough in China. This also applies to the large corporations: no other country except China would be able to tweak its trade balance within a few months. A call from Beijing and the airlines only buy Airbus instead of Boeing, and Siemens will build the power plants instead of General Electric. All conceivable steps in the battle of the systems.
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