Another chapter in the trade war between the US and China

in LeoFinance8 months ago

It is a secret to no one in the world that the US and China maintain very tense relations due to the constant trade war they have between each other. The rest of the world, we are just in the middle of that war, as spectators.

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Another chapter in history

This week we have had another chapter in the history of the trade war between these two countries. Because as we have seen from the news, China banned its government officials from using iPhone phones. The event had an immediate negative impact on the market price of Apple shares, which plummeted by around $200 billion.

Now, what reading can we give to this situation? Is China looking to harm Apple? Hardly. In fact, statistics say that, despite the tense political and economic situation between China and the US, the Asian country is the Apple largest international market. In other words, China is by far the country where Apple has the largest market share.

So, what can we deduce from all this? Is it that China wants to take revenge on the US for all the retaliation it has taken in the past against Chinese technology brands (like Xiaomi)? It's also hard to believe, because while it is true that the US had restrictions against Xiaomi in the past, those restrictions were recently lifted (to be more precise, they were lifted in May of this year). So the US removed Xiaomi from its blacklist.

Another reading of the situation, and perhaps the most probable

Although as I already said, in the US the restrictions against Xiaomi were lifted, this occurred due to a court ruling. And we must not forget that the restrictions were imposed by the United States Department of Defense itself, which classified it as a "Communist Military Company China".

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Although, due to lack of evidence, a court ruled in favor of Xiaomi, it is clear what the US government's position remains in this regard. In my view, the great fear of the US in this regard is that the Xiaomi company and its devices are a means and a mechanism for the Chinese government to spy on the US government.

While there is no evidence of this, it is not unreasonable to think so. But basically, what applies to one country also applies to the other. So I think that the Chinese government has strong suspicions that the US uses Apple devices to spy on it. Which is why it has prohibited the use of such devices by its officials in government facilities.

Founded or unfounded, as I already said, China's suspicions are not unreasonable either. In the military, geopolitical, economic and technological sphere, great powers such as the US and China are waging an all-out war. So all types of espionage are possible in this sense.

While I know some will say these are all really crazy conspiracy theories, they're not. It is something that is more common at the level of companies and governments than one might think. Because technology corporations worldwide (of all countries) do not escape this reality.

Through commercial espionage, and through reverse engineering, large technology corporations steal or copy the great advances of their competitors. But at the government level, the information is even more sensitive and therefore there are greater risks. Because what is handled in that scheme of things is classified military information that can change the situation in the geopolitical sphere forever.

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As I already said, these types of measures are not unreasonable

And much less because in the technological field all the information that we (smartphone users and technology in general) put in the hands of companies is very large, and growing.

I mean, I am not advocating to stop using smartphones by any means, but we have to be clear that our phones today are, among many things, a means for large corporations to obtain important information from us consumers, and even without realizing it and without our consent.

The worst thing is that for reasons of social status and trends, the adoption of more expensive and powerful smartphones is increasing. Why do I say it's the worst? Because users of technological devices are paying more and more money to have devices that invade their privacy and, in a hidden way, put their personal and sensitive information at risk.

And the worst thing, it is no longer just with smartphones, because now we also have smart televisions, smart refrigerators, etc.

Most global tech and telecom companies will deny all this, but it is actually an undeniable fact. I recently saw a news story that said that among the younger generations, the iPhone was much more popular than Android-based devices from any other company due to a simple matter of mentality and status. Apparently, young people associate devices that use Android with old and old-fashioned people (like their parents). If you ask me, it's totally stupid, but these types of things are also the result of the marketing strategies of large technology companies and corporations to prevail over their competitors.

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In fact, we know that the two largest companies that dominate the smartphone industry are Apple and the South Korean company Samsung. But Apple has no rival in smartphone sales worldwide. In fact, even though Samsung devices are as good and efficient as Apple's, the Cupertino-based company is winning the battle even within its own territory, that is, in South Korea, where it is prevailing in sales.

In any case, what I mean by this is that in matters of technology, sometimes it is not so much quality that prevails, but trends and the trade war that companies maintain among themselves when they compete for global market share.

But returning to China and the US

Everything seems to indicate that the trade war between China and the US will continue forever, or until one of the two ends up prevailing over the other. The truth is that China may also be harboring resentment against the United States over the recent chip issue. Those who are attentive to technological news will know very well what I am talking about here.

It turns out that the two largest sellers of cutting-edge chips are neither the US nor China, but Japan and the Netherlands. But it also turns out that the US prohibited these countries from September 1, 2023 (that is, since some days ago), from selling semiconductors or chips to China.

This may be the cause of the Chinese government's recent hostility towards the Apple brand. In fact, you can almost certainly say that it is. And if you ask me, I think it's a dirty trick to limit competition in this way. It seems to me that this is a North American monopolistic practice to limit China, in the purest style of the titans of North American industry when they blocked all the possibilities of their competitors in the 19th and early 20th centuries.

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But China is not just any country. In fact, it is known that the Asian giant is currently spending a fortune creating its own chips. At the moment, they are not as advanced as those of countries that are at the forefront of technology. But we already know how resourceful, intelligent and persistent the Chinese are. So the most likely thing is that at some point they will find a way to produce chips of the best possible quality so as not to depend on anyone in that regard.

History has proven this time and again and although many people believe that China is only capable of producing trinkets. The truth is that in most cases they produce technological items (and almost all types) of all possible ranges and qualities.

The thing to remember in all of this is that while the United States is the largest economic and military power in the world (and the country that issues the most widely used fiat currency in the world), China is following increasingly closely in both directions. And for decades it has been the world's largest manufacturer of goods of almost all types.

You may be wondering, dear reader, who do I think is right in this trade war between China and the United States? Well, the truth is that I don't think it's a question of who is right or wrong, I think this all goes much deeper than that. And frankly, I think that the tricks that both sides use in all the areas in which they compete are the dirtiest. But that's the world, and especially the business world. Let us always remember the saying "In war and love all is fair."

What do you think about the topic discussed? Please comment.

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