Eduard Voytenko: “Huawei, ZTE, and the West: Nothing New in Unfair Competition”
Eduard Voyenko, CEO of Baikal Communications Group, wrote a colomn about modern aspects of IT companies competition on the global market for The Dialogue of Civilizations Research.
The United States’ efforts to squeeze out Chinese IT companies from Europe are no different from a similar policy regarding Russian energy projects. According to the logic of the US government, if Nord Stream 2 threatens the EU’s energy independence (and liquified natural gas from the US does not), then Chinese telecom equipment threatens EU cybersecurity as well. The US has explicitly advised Europeans to switch providers, avoiding Chinese-owned Huawei and ZTE.
The need to diversify energy suppliers for the benefit of Europe’s stability and political independence from Russia has been talked about for a long time. The United States also needs European markets to fuel its own economic growth. Therefore, US policy in this case is really just unfair competition.
China can compete in terms of price with Western IT products as effectively as Russia can regarding the European energy market.
The political paradigm in which Russia and China are a vital threat to Western civilisation helps cut these two countries off from European and, of course, US consumers. But the economic interests of the United States in relation to Europe extend much further. They even affect areas of competition with strong European companies, which are not currently accused of belonging to the new ‘axis of evil’.
Just look at the list of ‘special industry agreements’ that should have been developed within the framework of the Transatlantic Trade and Investment Partnership: textile and chemical industries; pharmaceuticals; cosmetics; medical products; the automotive industry; electronics; engineering; plant protection products; and agricultural and food products. For each of these areas, the US has interests in Europe, but European manufacturers can also compete with the US under current European protectionist conditions. What will the US do in the future to expand its sectoral influence within the EU? It is difficult to say, but we can assume it will be interesting. What we cannot deny the US though, is leadership in terms of public relations and political pragmatism.
Russia only plays a secondary role in the struggle for domination of European and US high-tech markets. Due to the size of its market, Russia simply cannot be an alternative avenue for growth on its own, only in conjunction with other developing countries. Russia alone is too small for global companies to further their development and see progress there as a way of overcoming the financial consequences of losses in US and European markets. If one of the East’s high-tech giants was to ‘squeeze’ its US competitors from developing country markets (including Russia), then perhaps Russia could count on some degree of technological localisation and transfer. However, this would not be too profitable for the firm itself.
And if corporations themselves determine the degree of their readiness to enhance loyalty for the sake of markets maintenance, China’s political elite will draw definite conclusions about the prospects for fair international competition in the developed market economies.