Trump's trade war in tech: What's China doing, and is it working?

The US has delivered some heavy blows in the ongoing trade war against China. What is Beijing doing to hit back - and what will the fallout be for global tech?

Everybody knows about President Trump's trade war with China. According to US Census Bureau figures, as of May, America had imposed tariffs on more than $250bn of goods - around half of all its imports from China. China has sought to retaliate in kind, imposing tariffs on $110bn of goods, but Beijing has limited scope for widening its tariffs further as Chinese imports from the USA are only $120bn.

So what else can China do to hit back at Trump?

Chinese state media has been hinting that Beijing may seek to manoeuvre against the US and its Western allies in an area that could hurt them badly: specifically, technology. According to official news sources in China, the People's Republic is planning a new "technology security management system" which might bring in new controls, not of China's imports but of its exports.

China's top economic planning organisation, the National Development and Reform Commission, has been assigned to design the details of the plan. So far, little other information has been released.

The move would seem to foreshadow a response to the recent US move placing a ban on Huawei Technologies, barring the colossal Chinese networking vendor from buying American technology and compelling the Shenzhen-based giant to remove US components and software from its products.

One major impact of this is that Google has ended deals with Huawei under which the Chinese firm used its software in mobile handsets. Huawei, like almost all smartphone makers other than Apple, uses Google's Android operating system in its phones. With the ban in place Huawei's ability to offer a viable user experience in smartphones is in question.

‘We are capable of impacting the US supply chain'

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