China will win the trade war and wean off American technology in 7 years, strategist says

FAN Editor

China will win the trade war with the U.S., and eventually wean itself off its reliance on American technology, a strategist told CNBC on Monday.

“China will never trust the United States again, and it will achieve its technology independence within seven years,” David Roche, Independent Strategy’s president and global strategist, told CNBC’s “Squawk Box.”

China has traditionally been reliant on U.S. suppliers for key tech components such as chips and software, as well as modems and jet engines, but recent developments in the two countries’ protracted trade war have strained those ties and affected businesses from both sides.

In May, Chinese tech giant Huawei was placed on a U.S. blacklist, restricting the firm from purchasing American-made chips and software unless they got permission to do so. Some American mobile networks also use Huawei gear, while other U.S. companies have said their revenue will be affected by the blacklist. 

Alphabet’s Google also halted all business activity with Huawei, a move that means future Huawei phones will no longer come installed with Google’s Android operating system.

It’s not just about trade. It’s about technology, it’s about the free flow of ideas, it is rapidly becoming about the free flow of individuals … So it’s a really wide conflict, and it’s simply not gonna go away.

David Roche

global strategist, Independent Strategy

Amid those tensions, China is reportedly surveying its tech companies to gauge their exposure to American suppliers, and also ramping up development in its own tech industry.

For instance, it is developing its own chip industry. Under the government-led Made in China 2025 initiative, the country aims to produce 40% of its semiconductors by 2020, and 70% by 2025.

Currently, only 16% of the semiconductors used in China are produced domestically, according to a February report from the Center for Strategic and International Studies. Just half of those are made by Chinese firms.

Roche predicted that the end of the trade war is not in sight, though talks are slated to resume in October.

That’s because the U.S.-China trade war isn’t about trade alone, he said.

“It is a conflict between a rising global power and a declining global power … It’s not just about trade. It’s about technology, it’s about the free flow of ideas, it is rapidly becoming about the free flow of individuals,” Roche said. 

“So it’s a really wide conflict, and it’s simply not gonna go away,” he concluded.

Free America Network Articles

Leave a Reply

Next Post

Land Rover unveils the all new Defender at Frankfurt Motor Show after 22-year hiatus in US

Land Rover finally revealed its newly redesigned 2020 Defender at the Frankfurt auto show on Monday — a boxy SUV that was pulled off the market in North America in 1997. Land Rover gave its new Defender a power boost with so-called mild-hybrid electric vehicle technology the didn’t exist 22 years ago. […]