Donald Trump demands US allies join his Huawei blacklist, but what is he offering in return?
- The Trump administration’s America-first agenda is not compatible with its new cold war, which requires allies to forgo Chinese technology at their own expense
The cold war of the 20th century pitted two rival military alliances against each other. By contrast, the Sino-American rivalry involves two economies that are closely integrated both with each other and with the rest of the world.
The most decisive battles in today’s cold war will thus be fought on the economic front (trade, technology and investment), rather than in, say, the South China Sea or the Taiwan Strait.
Some American strategic thinkers have recognised this, and now argue that, if the US is to win this cold war, it must sever its commercial ties with China – and persuade its allies to do the same.
The case against entrusting Huawei to build 5G networks in Western countries is strong. Given the Chinese government’s unfettered power over the country’s companies, including Huawei, technology in 5G networks could give rise to serious security risks.
For countries that cannot afford the expensive equipment (and view Chinese domination as only a distant concern), those risks may be worth taking. But that is not the case for America’s wealthy allies.
Yet, so far, only Australia has complied with the US demand to ban Huawei. While Canada is considering joining, European countries have defied the Trump administration, with the UK and Germany indicating that they would allow Huawei to participate in the construction of their 5G networks. South Korea and India have similarly resisted US pressure to exclude Huawei.
Despite the national security implications, the fact remains that banning Huawei would result in higher costs and significant delays. Yet the US has offered no rewards or compensation to its wavering allies.
This underscores a key challenge that the US is likely to confront in the new cold war.
Though America is, ultimately, likely to come out on top, victory will not come cheap. Isolating China economically – which is crucial to gaining the upper hand – will require the US not only to shoulder its own costs, but also to compensate its allies for the losses they incur.
Such opportunism makes US allies doubt America’s resolve in an economic confrontation with China, fuelling fear that they will shoulder high short-term costs for nothing.
The Trump administration has already displayed an utter lack of concern for its allies’ economic interests.
Trump’s approach reflects not just a lack of loyalty, but also a lack of vision for sustaining, let alone strengthening, America’s own economic leverage.
Recall that, almost immediately upon entering the White House, Trump withdrew from the Trans-Pacific Partnership, a free-trade agreement that sought specifically to prevent Chinese economic domination in the Asia-Pacific region.
The new cold war against China will be won not through ideology or even weaponry, but through the deployment of economic incentives to wage a geopolitical struggle.
The winning strategy will not be one that weaponises only America’s greed. By nickel-and-diming its allies, the US is effectively disarming itself.
Minxin Pei, a professor of government at Claremont McKenna College and the author of China’s Crony Capitalism, is the inaugural Library of Congress Chair in US-China Relations. Copyright: Project Syndicate
Note: An earlier version of the article claimed that Huawei had been banned in New Zealand. Although a 5G proposal from one carrier was blocked, the option was left open for that carrier to work with Huawei on a subsequent proposal, and the process is still ongoing.