‘Tariff Man’ Trump Eyes Export Controls On US AI And AV Technology

THE TARIFFS TRUCE agreed by Presidents Xi Jinping and Donald Trump at their dinner during the G20 meeting in Buenos Aires last Saturday always looked a flimsy affair. For all it being long on self-congratulation — “a great success”, both sides declared — it was short on substance.

Moreover, the detail that has subsequently emerged, overwhelmingly through the media of Trump’s tweets and television appearances by members of his administration, does not appear to align with what the Chinese side thought it had agreed to — although it is difficult to divine what that was as it has been mostly silent on the matter.

In making his opening negotiating bids in public, however, Trump has wrong-footed (again) Beijing, which anyway prefers to hold such discussions well away from the discomfort of public view.

There does not even seem to be agreement on the start point of the 90-day tariff suspension to allow trade talks to proceed that both sides do acknowledge was agreed. Trump says the clock started ticking at the end of the dinner; China has made no public comment.

As we noted earlier, the threat of more tariffs hangs over the talks; “I am a tariff man”, says Trump. And there are, of course, potential auto tariffs coming down the pike, with the results of a Commerce Department ‘Section 232’ investigation into whether foreign car imports threaten US national security expected within a couple weeks.

However, a potentially more damaging long-term threat to China’s economy lies in a different sanction the United States is contemplating — technology export controls.

Late last month, the administration posted in the Federal Gazette a call for public comments on emerging and foundation technologies that the United States could ban its firms selling to China on national security grounds.

Some of the technology categories listed have a direct bearing on two core pillars of the ‘Made in China 2025’ industrial policy, artificial intelligence and autonomous vehicles. In the latter, Chinese manufacturers are dependent on US-bought chips and sensors, currently imported but intended increasingly to be sourced from foreign companies acquired by Chinese companies through mergers and takeovers.

This route, too, is being blocked. Hence the revived drive towards indigenous production. The public comment period is for a relatively short three weeks that run to December 19, suggesting the Trump administration is champing at the bit to implement export controls.

Update: The tone of the 90-day talks is not likely to be improved by the arrest in Canada at the United States’ request of Meng Wanzhou, Huawei’s chief financial officer and a daughter of the telecoms company’s founder. Washington has started extradition proceedings in connection with possible violations of sanctions against Iran and North Korea. In contrast, to its public pronouncements on the trade talks, Beijing has been quick and firm in its condemnation.

2 Comments

Filed under China-U.S., Technology, Trade, Uncategorized

2 responses to “‘Tariff Man’ Trump Eyes Export Controls On US AI And AV Technology

  1. Pingback: US-China Trade Deal: The Devil Is In The Enforcement | China Bystander

  2. Pingback: Coronavirus Could Nudge US-China Decoupling | China Bystander

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