The 2019 China Focus Essay Contest winners are Bailey Marsheck from Yenching Academy of Peking University and Michael Ostique from Shanghai University of Finance and Economics. Their essays answered the question, “identify one important domain of US-China competition and discuss one region where this issue will be key and its significance to US-China relations.” China Focus partnered with the UC-Fudan Center on Contemporary China to offer each winner $1000! Congratulations to our 2019 winners!
Below is Bailey Stephen Marsheck’s contest winning entry
We must not let ourselves be seen as rushing around the world looking for arguments… Nor should we let ourselves be seen as ignoring allies, disillusioning friends, thinking only of ourselves in the most narrow terms. That is not how we survived the 20th century. Nor will it serve in the 21st.
Daniel Patrick Moynihan, 2002
The late Dr. Moynihan’s words, delivered almost two decades ago, nevertheless ring all the wiser when applied to today’s context of US-China competition. Mounting antagonism between the United States and China is lending deeper strategic significance to numerous issue areas, few of which the US can tackle alone. Not only has US power atrophied vis- à -vis China and the rest of the world, but policymakers also face myriad challenges exceeding US global governance bandwidth. Mired in rivalry with China, the US must seek to revitalize close partnerships with its powerful, long-time allies in Western Europe, specifically Germany and the United Kingdom.
Recent US administrations have taken these historic ties for granted, doing little to facilitate future cooperation. But in light of the growing pressure that US-China contention over Huawei technology places on Western European allies, particularly regarding their domestic 5G telecommunications build-out, the US cannot afford to remain self-engrossed. Doing so would leave Western Europe to weigh the declining utility of US partnership against the benefits offered by China and Huawei’s 5G technology, spurring an outcome that even isolationists such as Donald Trump would find unpalatable.
The importance of Western Europe’s 5G network development as both a domain for US-China competition and an oppurtunity for renewed Trans-Atlantic collaboration should not be understated. Despite the issue receiving some mention alongside Huawei’s addition to the US Entity List, efforts to triage US policy priorities have misallocated national focus elsewhere. Mentioned as a list item in the litany of US concerns regarding growing Chinese influence, Western Europe’s 5G policies demand greater individualized attention. Infrastructure decisions made today by leading European powers Germany and the UK will not only dictate future cooperation pathways, but will also determine first- mover advantage in 5G standard-setting.
The Intricacy of Western Europe’s 5G Quandary
In a sentence, the 5G plight is as follows: Western Europe finds itself caught between the unstoppable momentum of next-generation telecommunications innovation, in which Huawei is the industry leader, and the seemingly-immutable American insistence that US partners ban Huawei equipment from their telecommunication infrastructures entirely or risk reduced security cooperation.
Telecommunications infrastructure requires high levels of location-specific physical capital; its installation establishes “path dependencies” linking service provider and user that cannot be cheaply walked back. On one hand, 5G has the potential to institutionalize Europe-China collaboration while unraveling security partnerships fundamental to Trans-Atlantic cooperation. On the other hand, 5G presents an opportunity for the US to demonstrate renewed willingness to work with its partners rather than simply dictate collaboration terms. Recent US rhetoric acknowledging American absenteeism is seen by European onlookers as too little, too late. The US government must credibly signal its consideration for the quandaries of its allies if it hopes for Europe’s support in broader US- China conflicts to come.
While allies have strong incentives to maintain security cooperation with the US, they cannot easily accommodate the Huawei ban America seeks. China possesses incredible economic influence which it has not been apprehensive about leveraging. Just last month, Chinese Ambassador to Germany Wu Ken threatened economic measures if Germany banned Huawei outright. European leaders such as Angela Merkel and Boris Johnson also cannot appear to be capitulating to a US regime disliked internationally. In addition, the affordability and timeliness of Huawei’s 5G installation is difficult to rebuff. Many countries already use Huawei for their 4G networks. For its part, America has no alternative to offer, meaning that adoption of a non-Chinese telecommunications provider would prove costly to Europe and delay 5G implementation. Needless to say, there are no easy solutions.
One option that appears off-the-table for allies is halting their pursuit of next-generation telecommunications entirely. As the technological frontier creeps ever-outwards, Western Europe looks to furnish their infrastructure with 5G technologies predicted to make interconnection seamless and latency negligible. With 5G comes new possibilities and renewed prospects for long-conceived innovations: autonomous driving, the Internet of Things, and a host of applications that will become obvious once 5G is synonymous with daily life. The technology has been deemed “as revolutionary as electricity or the automobile” by Don Rosenberg, Executive Vice-President of US-based telecommunications firm Qualcomm. As such, the perceived costs of missing out on the 5G revolution are significant.
Assessing the Huawei Threat
The US security establishment has good reason to fear Chinese technology placed centrally within core telecommunications networks. What makes telecom networks sensitive is their innate susceptibility to compromise. They must be designed to allow the provider to tap in, seize control, or shut them down. Huawei could theoretically have “back-door” measures in place to siphon information sent throughout its networks with impunity. Or, in the worst-case, the ability to shut down an entire communication network as a strategic instrument. For these reasons, American officials argue that joint security efforts with partners using Huawei networks may become problematic.
Huawei has taken a number of actions to reassure skeptical governments that 1) its equipment is not built with “back-doors” and 2) the company will not bow to pressure if the Chinese government seeks to utilize Huawei’s network access for espionage or strategic means. Western countries remain unconvinced on both accounts. Huawei has opened up its source code for review by both the Germans and the Brits, with British experts reporting that the company’s code simply couldn’t be deemed reliable upon inspection. Ultimately, it is an upward battle to convince skeptics of the company’s trustworthiness. Huawei was founded by former PLA member Ren Zhengfei and maintains close CCP ties. Some have also argued that China’s 2017 National Intelligence Law would ultimately force Huawei into compliance with the CCP.
Western European’s State of 5G Affairs
Huawei offers its equipment at significantly lower rates than its main competitors Ericsson (Sweden) and Nokia (Finland). Due to its affordability, cutting-edge services, and political push from the Chinese government, a number of countries have signed on to a Huawei-serviced 5G capability. While US allies such as Japan, New Zealand, and Australia have banned Huawei equipment entirely, key Western European powers Germany and the UK have kept their options open.
In Germany, Chancellor Angela Merkel has neither wholly supported nor opposed adoption of Huawei 5G equipment, claiming security implications should be evaluated on a case-by-case basis. She has made it clear the US will not dictate her decision, meeting threats of reduced data-sharing with pronouncements that German network security remains a German prerogative. The bureaucracy itself appears divided, with the head of German intelligence Bruno Kahl deeming Huawei technology untrustworthy and members of Merkel’s own party, the Christian Democrats, introducing a motion favoring European 5G alternatives.
In the private sector, German telecommunications provider Deutsche Telekom was testing a domestic 5G network that utilizes Huawei equipment before political considerations emerged. One source of ambiguity is Merkel’s decision not to seek re-election in 2021, leaving interlocutors uncertain how her ‘lame-duck’ status will affect the 5G policymaking process. She may leave deliberation to German parliament or alternatively exercise increased freedom from political constraints to assert her own preferences more muscularly.
With the UK set to leave the EU on January 31, 2020, it would be an understatement to say that British domestic issues have co-opted policy bandwidth previously devoted to discussions of 5G. In light of a significant stock of Huawei infrastructure that would be expensive to ignore, former Prime Minister Theresa May originally indicated a willingness to utilize Huawei equipment. While Boris Johnson has appeared ready to continue this approach, discussion was postponed until after the December 12 election and has remained on the back-burner since. Likely to rely even more heavily on trade partnerships with China as the UK exits the Common Market in some form, it appears probable that Johnson’s government will proceed with some form of Huawei cooperation.
The Way Forward
At this juncture, the US faces a policy dilemma of its own. Germany and the UK have adopted ambiguous compromise approaches to 5G network infrastructure. These key allies appear unwilling to administer the ‘blanket’ Huawei ban requested by the US and resent being beholden to US demands. Neighbors such as France and the Netherlands are poised to adopt a similar tack.
One policy option the US cannot choose is to double down on labelling Huawei equipment usage a condition for security partnership disentanglement. Not only would antagonistic rhetoric strain already-fragile alliances while driving allies towards long-term Europe-China cooperation, but it also may not be necessary. Policy experts have postulated that the US blanket ban of Huawei telecom equipment is a clumsy instrument used to address an intricate predicament.
While concerns of Chinese ownership over key networks are legitimate, this does not mean Huawei’s cost-saving benefits must be refused entirely. Surely, Huawei must be fully excluded from networks with strategic significance and omitted from the central nodes of less-sensitive networks, where components are afforded system control. Yet, there are few non-political reasons why Huawei equipment could not be safely employed in more isolated positions within telecom networks. Ideal US policy would be appropriately nuanced.
Although pivoting towards a case-specific tolerance of Huawei 5G equipment usage is infeasible domestically due to the political maelstrom the looming Huawei specter provokes, the US should soften its position and allow allies to utilize some Huawei technologies assuming risks are properly evaluated. Western Europe is already moving in this direction. Germany and the UK are imposing de- facto restrictions on Huawei equipment by utilizing it only in limited capacities, though they do so quietly to avoid provoking Chinese backlash. Although possibly compromised by Brexit uncertainty, the UK’s formation of a partnership with Huawei to facilitate examination of case-specific security risks is the most vigilant approach to date. For the US to push its allies to drop such thorough tactics in favor of a ‘broad strokes’ ban would be doing neither the US nor its partners any favors.
Besides toning down the uncompromising nature of anti-Huawei rhetoric and condoning well-vetted implementations of Huawei technology by allies, what further steps can the US take? Although talks of a nationalized 5G plan have abated, policymakers can build up domestic 5G capabilities by supporting the research of firms such as Qualcomm. While lagging global competitors, Qualcomm retains leadership of a 5G standards-setting body at Huawei’s expense, preventing the Chinese firm from taking a principal role in steering future 5G development. If the US can maintain competitive 5G firms, it can leverage its weight in international institutions to prevent China from increasing its 5G dominance through standards-setting. Simultaneously, stronger US alternatives for 5G provision would offer European allies one more reason to indulge their skepticism of China by eschewing Huawei reliance.
Even if US officials take up this piece’s policy prescriptions tomorrow (tolerate cautious usage of Huawei equipment in innocuous parts of Europe’s 5G networks, signal sensitivity to Europe’s predicament and intention to continue cooperation, and focus on homegrown 5G development to rival China in standards-setting while possibly providing a viable US alternative in the future), it will still take some time for Germany, the UK, and other Western European countries to assess their options. Regardless, these tactics constitute a necessary step away from US isolationism and toward meaningful integration with key historic allies. Moreover, less bellicose US rhetoric regarding Huawei may result in incremental abatement of zero-sum technology rivalry. But even if the severity of US- China antagonism continues ratcheting the world into disparate technological blocs, it is essential that the US confront its 21st century challenges alongside Western European allies such as Germany and the UK, rather than in precarious isolation.
(Image by Pete Linforth from Pixabay)
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Read on Essay Contest Winners’ articles:
Bailey Marsheck
