On Monday, U.S. prosecutors released indictments against Chinese telecommunications giant Huawei and its CFO Meng Wanzhou, alleging that Huawei attempted to steal technology and cover it up, offered cooperate rewards for industrial espionage, committed fraud, and misled companies on ties to Iran in violation of sanctions, and other charges.
Those allegations go to the heart of American complaints against Chinese trade abuses: lack of respect for intellectual property protections, robbery of technology, and the use of business to spy.
The U.S. is not alone in its increasing scrutiny of Huawei and other Chinese firms. As demonstrated by recent espionage charges against Huawei leading to arrests in Poland and a decision last year by the Australian government to rethink ties to the company, concerns about Chinese tech companies are widespread among the U.S. and its allies.
At the same time, Huawei is expanding in other markets. With less expensive technology and offers of lucrative partnerships, it presents itself as an attractive option for countries facing less U.S. pressure to stay away from Chinese firms potentially tied to nefarious operations.
The result is a divided market where some countries’ telecommunications are tied to Beijing and others’ are not. This trend toward a divided world is also apparent as China exports its model of a censored Internet and builds political ties through investments.
That breakdown into areas or regions dominated by Chinese technology and those that aren’t is a worrying shift away from a world united by trade and globalization to one defined by competing influence of great powers. And that breakdown, ultimately rooted in competing economic and political models, is unlikely to be resolved with even the best trade deal.
