Meia Nouwens, Maria Shagina & Erik Green
Against the backdrop of intensifying United States–China competition over technology, China has over the last six months shifted its strategy from using informal trade bans and symbolic legal and regulatory changes to actively imposing export controls. In doing so, Beijing is signaling that it has spent considerable time identifying its national economic strengths, weaknesses and exposure to US sanctions, and now is more confident in itself as an equal competitor against the US. While elements of China’s approach can be seen as emulating the United States’ export controls against Chinese technology companies, there are unique aspects to China’s strategy too – such as the creation of an economic early-warning system.
These moves should be understood within the wider context of China’s attempts to both enhance its national resilience and self-reliance in sectors that are central to economic growth and US–China competition as well as bolster its ability to use offensive tools against its adversaries. For now, this strategy looks to be directed mostly at the US as China seeks to rebuild its relationship with Europe while transatlantic relations are fracturing in the background. However, the extraterritorial nature of Chinese export controls means collateral damage is possible and US allies could also find themselves in the crosshairs of China’s new strategy.
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