President Biden’s administration has escalated tensions with China by adding more Chinese entities to an export blacklist than any previous US government. This latest move by the Commerce Department brings the total number of entities targeted under Biden to 319, surpassing the count during Trump’s tenure. The decision underscores the increasing use of economic tools to achieve foreign policy objectives, particularly as Biden seeks to limit China’s access to advanced technology, citing national security concerns.
The heightened scrutiny on China comes amidst growing apprehensions in Washington over President Xi Jinping’s assertiveness towards Taiwan, fueling fears of Beijing leveraging American technology to bolster its military capabilities. Both Democrats and Republicans have rallied behind the tough stance on China, reflecting bipartisan consensus on the issue, especially with the upcoming elections looming. Biden has maintained Trump’s tariffs while expanding restrictions on Beijing’s access to cutting-edge innovations, notably in critical sectors like AI.
The entity list serves as a primary mechanism for sanctioning entities on national security grounds and has increasingly become a focal point in US-China relations. Beijing has denounced Washington’s actions as economic coercion and unilateral bullying, vowing to defend the rights and interests of Chinese companies. In a retaliatory move, China imposed sanctions on two US companies, signalling a tit-for-tat escalation in tensions. However, such measures are largely symbolic, with minimal impact on the targeted firms.
Despite the Biden administration’s firm stance, there have been occasional concessions, such as withdrawing a Chinese government laboratory from the entity list to address the fentanyl crisis. Nonetheless, the recent additions to the list signal a continuation of the US strategy to maintain its technological edge, particularly in dual-use technologies. As Washington tightens controls on exports to Chinese firms involved in military modernisation efforts, the stage is set for further friction in the already strained US-China relationship.
China plans to operationalise a nationwide computing power network by next year, aiming to balance regional digital disparities and enhance capacity. The initiative, led by the National Data Administration (NDA), is a strategic response to President Xi Jinping’s call for digital advancement and innovation amid global competition.
Liu Liehong, the head of the NDA, at a recent conference assured efforts to enhance data infrastructure and hasten the development of the computing power network. The initiative will enhance data sharing and utilisation, maintaining equilibrium between public and commercial interests while fostering data-driven innovation. The need for rigorous regulation, including standardization of formats, security protocols, and clear data governance policies was further emphasised.
In addition, the launch of pilot projects for data labelling, essential for AI utilisation, was announced, setting the stage for AI advancements across sectors.
This initiative can be located at the backdrop of China’s ongoing technological race with the US, as China intends to boost its computing capacity, currently second only to the US, by 50% by 2025.
China has unveiled a national plan to develop its own metaverse by 2025, with the goal of creating three to five globally influential metaverse companies. This plan was published by five Chinese ministries led by the Ministry of Industry and Information Technology in a policy document.
The policy blueprint covering the time period of 2023 to 2025 highlights the application of metaverse technology in various industries, such as home appliances, automotive, and aerospace.
The development of artificial intelligence, blockchain, and virtual reality technologies will be key to achieving the metaverse vision and the Chinese government aims to establish three to five industrial clusters around these emerging technologies. The document also suggests that manufacturing industries, including steel and textiles, can adopt related technologies to optimize scheduling, material calculation, and other parts of the production process.
Previously, some local authorities in China like Henan and Shanghai province have also issued their own policies to promote metaverse development, emphasizing on how it can support the economy and traditional industries.
Foxconn, Apple’s main supplier is set to invest close to $500 million in building two component factories in India. This is in addition to the $700 million investment in a Bengaluru plant that is expected to assemble iPhones and create around 100,000 jobs.
Apple has been re-examining its China-reliant supply chain ever since Covid-19-related disruptions caused output at Foxconn’s Zhengzhou plant (currently the world’s biggest source of Apple’s iPhone) to plunge ahead of the 2022 holidays. Foxconn’s recent investments in India is a reflection of India becoming a popular destination for manufacturers seeking an alternative to China.
With China’s unstable regulations, a sluggish economy, and trading restrictions imposed by the US, western investors and corporations are becoming increasingly disillusioned and seeking to diversify their supply chains. This shift in the global supply chain has been expedited in parts due to the Covid-19 pandemic, the escalation of tension between the US and China, and the conflict in Ukraine.
China’s cyberspace regulator has recently closed over 100,000 online accounts that were spreading false news and rumours about news anchors and media agencies to ‘clean up the internet’. The Cyberspace Administration of China (CAC) has started a campaign to sieve out social media accounts that pretend to be state-controlled media and spread ‘fake news’.
The regulator asserted that it would provide guidance to online platforms in order to protect the legitimate rights and interests of the majority of internet users to get accurate news. The regulator also encourages users to report fake news and news anchors by providing leads.
The government implements strict measures to remove internet content and language that it considers unsuitable, offensive, or harmful to the public and businesses. Such a crackdown can be contextualised as a larger part of a global effort to combat the spread of fake news, with many countries implementing laws to punish those who spread it.
