GT Voice: US long-arm jurisdiction over tech exports strangles EU multinationals

Illustration: Chen Xia/Global Times

The U.S. Commerce Department said on Wednesday it had suspended the “export privileges” of a Belgian company and its owner for 180 days over its alleged attempt to “send sensitive technology to China”, it said. reported Reuters.

The US Department of Commerce claimed that Hans De Geetere and the Belgian company Hasa-Invest purchased or attempted to purchase accelerometers from a US company on behalf of customers in China, but falsely told the US company that the accelerometers were intended for customers in Europe, according to Reuters.

The Belgian company and its owner have not publicly commented on the US charges as of press time Thursday. And it’s unclear whether the US Department of Commerce accurately presented relevant information about the Belgium-based company’s alleged attempt to send accelerometers to China. However, it should be noted that the military’s long-lasting proficiency in a wide range of areas has become as American as apple pie. It should also be common knowledge by now that broader US bans on high-tech exports will hurt not just Chinese companies, but also European, American and other multinationals.

Since former US President Donald Trump took office in 2017, the United States has begun to take various measures to prevent China from carrying out what had long been normal transactions in the technology sector. And such an ill-intentioned campaign has continued and may intensify further under current US President Joe Biden.

In the United States, the US export control process is now at the center of a debate over the amount of trade between the United States and China in the high-tech sector, and many American politicians favor the reduction in exports of sensitive technologies, because they believe that the United States should prioritize national security over American commercial interests. However, these anti-China politicians may not realize that what they are suggesting can have a significant negative impact on the earnings of US tech companies and hamper the development of America’s own technological strength.

The industrial structure of today’s world is based on a complex supply chain system. The United States has dominant advantages in some advanced technology areas, but China is the world’s largest manufacturing base, which plays a key role in the global supply chain and serves as the “end customer” for many European and multinational companies that import high-tech products.

If the United States wants to achieve its ultimate goal of restricting exports of high-tech products to China, American politicians will have to launch an export ban not only on Chinese companies but also on companies in the supply chain. world. This is why more and more European companies have been drawn into the crossfire of unreasonable US restrictions on the export of high technology.

The unilateral approach of the United States will be a step backwards for globalization and will lead to unbearable results. In addition to bilateral trade between the United States and China, the continued crackdown will likely extend to trilateral or multilateral supply chains from the United States, Europe and China to impose stricter restrictions aimed at to isolate China. Due to the tighter restrictions, the export market for US high-tech companies will be further reduced. It will be a gradual process and will take place step by step.

Tighter restrictions on US tech sales to China will backfire badly on the US as the UK, Germany, Japan, South Korea and other tech giants step in to fill the gap. the vacuum left by American companies. More importantly, China attaches great importance to independent innovation, and sales of independently developed high-tech products have increased in Chinese markets.

If US high-tech companies are to survive increasingly fierce international competition, they need export markets. The more stringent restrictions the U.S. government imposes on technology sales through long-arm jurisdiction, the less chance U.S. tech companies have of surviving global competition.

Thelma J. Longworth