from Digital and Cyberspace Policy Program and Net Politics

The Summer of the Ban

A member of National Students' Union of India (NSUI) holds a placard during a protest against China.
A member of National Students' Union of India (NSUI) holds a placard during a protest against China. REUTERS/Amit Dave

This summer, an increasing number of Chinese tech companies have been pulled into geopolitical incidents involving Beijing.

September 21, 2020

A member of National Students' Union of India (NSUI) holds a placard during a protest against China.
A member of National Students' Union of India (NSUI) holds a placard during a protest against China. REUTERS/Amit Dave
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Connor Fairman is a research associate in the Digital and Cyberspace Policy program at the Council on Foreign Relations.

While most people in the United States will remember summer 2020 for the coronavirus pandemic, for many Chinese technology companies their clearest memories will be of their products being banned from some of the largest markets in the world. After the Trump administration announced new restrictions against companies selling products made with U.S. technology to Huawei in May, the telecommunications giant was effectively banned from India and the European Union. The United States and India both announced bans against TikTok and WeChat, and in early September, Delhi announced that it was banning an additional 118 Chinese apps, bringing the total number of Chinese apps banned by India this summer to 177.

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5G

Economic Statecraft

South China Sea

Technology and Innovation

The decisions to ban various Chinese tech products this summer were broadly justified as efforts to protect national security. These threats have existed for a while, however, and the more immediate causes are geopolitical incidents involving China. Beijing’s crackdown on Hong Kong, initial mishandling of the COVID-19 pandemic, and border conflict with India have all helped trigger the wave of bans. They have also contributed to a rise in anti-China sentiment in the countries where these bans took place, leading an internal report by China’s Ministry of State Security to conclude that “global anti-China sentiment is at its highest since the 1989 Tiananmen Square crackdown.”

Against this geopolitical backdrop, banning Chinese tech products is an attractive tool for many policymakers because it allows them to push back against China without risking military escalation. In India’s case, banning Chinese telecoms and apps appeases domestic calls for a boycott of Chinese goods and retribution for Indian troops killed near the disputed China-India border.

India is well-positioned to use bans. Its smartphone market is the second-largest in the world, behind China, and, prior to the COVID-19 pandemic, was expected to continue growing at an annual rate of over 14 percent over the next three years. Exclusion from India represents enormous losses in revenue for Chinese companies, and new space for Indian companies to replace them. Leaders from smaller but still dynamic markets, though, could be tempted to follow India’s example, banning Chinese tech companies’ products when military or diplomatic options are unattractive or unavailable.

The South China Sea would be a prime use case for this. In particular, Vietnam, which routinely condemns Chinese military activity in areas of the South China Sea claimed by Hanoi and lacks similar assurances of U.S. support as the Philippines, could retaliate against Chinese incursions by banning Chinese tech products. Vietnam has the largest population in Mainland Southeast Asia, high smartphone use, the fastest e-sport market growth rate in Southeast Asia, and a population of which 50 percent is younger than twenty-five. TikTok and the mobile version of PUBG, a video game that Tencent, a Chinese tech giant, developed, are popular in Vietnam and could become targets of such a policy. Similar conditions exist in Indonesia, the most populous country in Southeast Asia, which temporarily banned TikTok in 2018 and recently lodged a protest against Chinese maritime incursions into its sovereign territory.

The U.S. Department of State’s Clean Network program announced in August might also provide an incentive for some countries to ban Chinese tech products in the future. At its unveiling, the program announced a list of over thirty “clean countries” that had committed to excluding China from their 5G networks. For countries that consider banning Chinese technology, the program, and the growing list of countries that have signed on to it, could provide diplomatic coverage and support. In particular, the Clean Store line of effort, which calls for the removal of Chinese apps from mobile app stores, could be an easy pathway for countries to punish Chinese behavior, due to the relative ease of banning apps, compared to scrutinizing undersea cables, cloud service providers, and telecommunications networks.

More on:

China

5G

Economic Statecraft

South China Sea

Technology and Innovation

As summer 2020 comes to an end, Chinese tech companies have much to worry about. With Huawei’s global aspirations effectively shattered by the U.S. Department of Commerce’s newest restrictions in August and several other Chinese companies falling victim to geopolitical tensions, they should be wary of their positions in countries that have strained relations with Beijing. Now that India, the European Union, and the United States seem to have settled on banning Chinese tech products, other countries with active disputes against China could see that as their cue to follow suit at the next opportunity.

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