Working with China is more beneficial than fighting it


It appears the political and security elites in the United States are preparing for an OK Corral-type s
howdown with China. On December 1, the US Justice Department asked (some would argue pressured) Canada to arrest Meng Wanzhou, the chief financial officer of Chinese telecommunications giant Huawei, on a provisional warrant. It went on to charge two Chinese government employees with stealing information from firms and governments in 12 countries.

The big question is: Why now and what does the US hope to gain from these provocations?

China’s economic, technological and military rise
A brief look at China’s accomplishments in the economic, technological and military realms might shed light on the question.

The size of China’s economy is estimated at US$13.7 trillion in nominal exchange rate measurement and it met the targeted growth rate of 6.5% in 2018, according to China’s National Bureau of Statistics (CNBS). China’s growth rate is far greater than that of the US, estimated at around 3% by the US National of Statistics. If the trend continues, the Chinese economy could well topple that of the US, becoming the biggest economy in both measures.

The remarkable annual average growth rate of nearly 9% has allowed the country to spend lavishly on research and development and higher education, estimated at over US$260 billion and US$175 billion, respectively, in 2017 by the CNBS. A big chunk of higher education spending was on science, technology, engineering and mathematics (STEM).

As a result, China produces over 6 million STEM graduates each year and a similar number worked in research. These millions of STEMs are the country’s best and brightest scientific and engineering minds.

This might be a more compelling explanation of why the country is fast closing the innovation gap with and even surpassing the US in some areas – 5G, AI, driverless cars, high-speed railway, etc – than China stealing American secrets.

Huawei is at the forefront of 5G technology and the biggest (and some would suggest the best) telecommunications equipment manufacturer in the world. According to the company’s press release, almost 170 countries are using its equipment. Huawei is also the world’s second-largest smartphone producer, surpassing Apple but behind South Korea’s Samsung.