China’s President Xi Jinping raises concerns over ‘technological divide’

Xi urges openness and collaboration . . .

In his keynote address at the Chinese International Import Expo held this week in Shanghai, China’s President Xi Jinping called for continued co-operation in research and development in technologies such as 5G and artificial intelligence (AI). Xi warned that stifling the international flow of information and talent could not only slow or hinder innovation, but also “widen the world’s technological divide,” directly referring to the recent attempts by the U.S. to contain China’s advances in Industry 4.0 technologies.

China against the West?

Amid the ongoing U.S.-China trade war, Chinese tech companies have encountered increasing U.S. restrictions. Huawei faces export and use restrictions in the U.S. and similar challenges from America’s allies, including Japan and Australia. Similarly, Washington recently blacklisted iFlyTech, China’s emergent leader in AI. Concerns over illiberal uses of technology, accusations of espionage and IP theft, and lax regulations on privacy have been attributed to the restrictions. These heightening tensions in tech point to the underlying issue of geopolitical hostility between the U.S. and China, and the emergence of tech as a theatre for superpower competition. Some analysts, however, have highlighted the dangers of artificially fragmenting the tech industry across national boundaries as the sector depends on deep global supply chains.

Canada caught in the middle . . .

Canada is in a difficult position between the U.S. and China, as highlighted in the political crisis that emerged following the arrest of Huawei’s CFO Meng Wanzhou last December. Canada, as part of the Five Eyes intelligence alliance, is considered a strategic partner for the U.S., which has increasingly pressured Canada to join its global containment of China’s tech industry and has repeatedly called on Ottawa to ban Huawei 5G. Canada has also been in talks with the U.S. regarding the development of a coalition of democratic nations that could form a data pool to compete against China. Given that Canada relies heavily on commercial relations with China, alienating Beijing at the expense of Washington could be counterproductive and will require Canada to find its own balance between the two superpowers.