The latest symbol of the division between the United States and China is China bans on government employees using Apple’s iPhone at work. This move had a significant impact on Apple’s share price, reflecting the ongoing technology and trade disputes between the two nations.
This action mirrors the United States’ long-standing approach of targeting Chinese technology companies. Australia, for example, banned Huawei from its core 5G network, following concerns about China’s potential to engage in activities similar to those the US routinely undertakes.
Huawei, despite being affected by US restrictions, is now making strides in the smartphone market with its new device, powered by a chip that outperforms what US trade restrictions anticipated.
The United States’ actions to limit China’s technological growth, such as restricting trade and imposing sanctions, are inadvertently strengthening China’s resolve to succeed. This approach leads to a sense of national pride and determination, which may result in China becoming a stronger competitor in the global technology landscape.
However, the impact of these actions extends beyond smartphone sales. The United States’ efforts to divide the world into allies and adversaries have led to a wave of protectionism. This protectionism is often framed in terms of “security” and “climate,” but it is effectively reshaping the global economic landscape.
The United States, despite its rhetoric about a “rules-based” trading system, is now one of its primary abusers. This new protectionist wave, often euphemistically referred to as “deglobalization,” is making it challenging for central banks to control inflation.
Australia, in its efforts to align with the United States on various fronts, is becoming increasingly enmeshed in this global division. Despite Asia and particularly China being its most significant trading partner, Australia is aligning itself with the United States in areas such as defense, trade, and diplomacy.
Furthermore, the shift in the United States’ stance towards China, with both Democrats and Republicans expressing anti-China sentiments, adds to the instability in global relations. This change in tone from the United States makes it challenging to predict the outcome of future elections and the impact on international relations.
Australia’s role in this global dynamic, particularly its participation in a regional arms race, is not necessarily in its best interests. The lack of subtlety in its defense and security industry, as evidenced by the treatment of a visiting Chinese academic, raises questions about Australia’s approach to diplomacy and its regional role.
In conclusion, Australia’s alignment with the United States amid growing divisions in the world poses challenges to its economic and diplomatic interests. The lack of subtlety and the embrace of protectionist policies may have unintended consequences for the country’s future.