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IPFS News Link • China

China Likely Will Agree to Trade Deal to Minimize Decoupling

•, by Brian Wang

Is it geopolitically prudent for a large part of the US industrial supply chain to be inside of China? Why are American companies allowed to transfer critical technologies to China in exchange for short-term market access?

A study titled '2015 Global Innovation 1000' by Strategy& and PwC, looks at key trends of the 1000 global organizations that spend the most on R&D.

American firms are moving their R&D operations to China not just to take advantage of lower costs, but to be in close proximity to their supply chains. About 50 percent of foreign R&D centers in China are now run by American companies, helping China achieve first place in market share for manufacturing R&D.

American policy toward China is seeking to prevent American businesses from speeding the rise of an adversary. Tariffs are one piece of an emerging anti-China strategy. The Trump administration is rolling out new export controls to limit the transfer of sensitive technologies such as AI and quantum computing. They have blacklisted high-tech Chinese firms such as the telecom giant Huawei from doing business in the U.S.

China is working to reduce its dependence on foreign wide-body airplanes, semiconductors and oil and gas.