Minister: Technical and billing issues also to blame for price spike
PUTRAJAYA: Negligence and technical fault on the part of Tenaga Nasional Bhd were two among three reasons why electricity bills spiked for certain consumers but the government is having none of it.
Energy, Science, Technology, Environment and Climate Change Minister Yeo Bee Yin, who disclosed this, said TNB must be made accountable for what happened or risk facing legal action from consumers.
“They are not just going to get a slap on the wrist but must be accountable for this and resolve the matter with consumers. Fail to do so and they will face legal action,” she told a press conference at her ministry yesterday.
Also present was Energy Commission chairman Datuk Ahmad Fauzi Hasan.
The Commission had met TNB earlier yesterday over the uproar among consumers in Melaka, and other parts of the country who complained of higher than usual power bills.
Besides the two reasons, Yeo said the other given was that consumers were billed for electricity usage for over 30 days when the standard procedure required the utility firm to issue bills for 30 days.
Yeo said the complaints on surge in power charges was from consumers nationwide and not just Melaka households involved in the smart meter pilot project by TNB.
Many consumers had vented their frustration on social media.
In May alone, more than 300 complaints were lodged with the Commission. This was 10 times more than the complaints in the same month last year.
Yeo said the Commission would play its part by investigating the complaints and submit its findings.
Asked whether the affected consumers should settle their dues first, the minister said she would discuss the issue with TNB and believed the problem could be resolved before the payment deadline.
On the smart meter issue, Yeo said the Commission was also investigating to find out what had gone wrong.
Melaka is among the pioneer states to introduce the smart meter and to date, over 300,000 households have already been fitted with it.
Chief Minister Adly Zahari was quoted as saying that he wanted TNB to ensure the system was implemented properly and to resolve several problems, including that the reading shown on myTNB was not the same as that on the meter.
A TNB spokesman said grievances from consumers would be addressed on a case-by-case basis, adding: “Our role is to listen, understand and serve our customers while upholding the law.”
TNB also inviteed consumers in Melaka with grouses to attend its Customers Day at its office in Jalan Banda Kaba which will be held until Friday (8.30am to 4pm daily).
It said each case would be investigated based on the electricity use pattern over the last six months.
The firm said it will also, upon investigation, credit any surcharge to the consumer’s account, in the event of overcharging or when excess reading had occurred.
Alternatively, customers can contact the TNB Careline at 1300-88-5454 or visit any TNB office in Alor Gajah, Bandar Jasin, Merlimau and Urban Transformation Centre (UTC) at Jalan Hang Tuah.
Meanwhile, Domestic Trade and Consumer Affairs Minister Datuk Seri Saifuddin Nasution Ismail said the Cabinet was the best avenue to discuss the issue of irregular electricity billing and the solution to it.
He believed Yeo would most likely be asked to explain the matter in today’s Cabinet meeting.
“I have received a lot of Whatsapp messages on this matter. The reaction we have received was nationwide,” Saifuddin said after chairing his ministry’s monthly assembly here yesterday.- The Star
The founder of the Chinese technology giant Huawei, Ren Zhengfei, has said in an interview with Bloomberg that he would be "the first to protest" if Beijing retaliates against the US-based tech giant Apple.
A Bloomberg reporter has asked the Huawei CEO in an interview whether he would retaliate against Apple amid "calls by some in China" to take countermeasures against the US company.
"That will not happen, first of all. And second of all, if that happens, I'll be the first to protest. Apple is the world's leading company. If there was no Apple, there would be no mobile internet. If there was no Apple to help show us the world, we would not see the beauty of this world. Apple is my teacher. It's advancing in front of us. As a student, why should I oppose my teacher? I would never do that", Ren Zhengfei has told Bloomberg in an interview, published on Sunday.
Huawei has been accused by several countries of being sponsored by the Chinese state and spying on its behalf through its devices.
US President Donald Trump issued an executive order earlier in May that added Huawei and its 70 affiliates to a trade blacklist, thereby restricting its activity in the country. US companies are hence required to receive permission before trading with the telecom company.
As a result, Google had to suspend business operations with Huawei, including the transfer of all hardware, software and technical services, except those publicly available via open source licensing. This move has already impacted the telecom giant, with several mobile carriers, such as UK Vodafone and EE suspending their launches of new Huawei products.
The standoff between Huawei and Apple was sparked by the December arrest of Huawei Chief Financial Officer Meng Wanzhou, the daughter of Huawei's founder in Canada, for alleged violations of US sanctions on Iran. Beijing decried the move and demanded that Canada immediately release the Chinese national.
In January, the Chinese telecom giant punished staffers who used an iPhone to send an official company tweet amid a standoff between the two tech giants. In an internal memo, published online by Chinese media, Huawei said those responsible were demoted and had their salaries slashed by $730.
Meanwhile, US Secretary of State Mike Pompeo claimed on Thursday that the Chinese tech giant allegedly had close links to not only the Chinese government but also to the Chinese Communist Party. He said that these ties significantly threatened any US-related information that passed via Huawei's devices. Pompeo also said the State Department expected more companies worldwide to cut ties with Huawei in the future.
The Chinese Foreign Ministry said Friday that Pompeo's remarks were made in an attempt to stir up ideological resistance against the company.
Last year, the United States, Australia, Japan, and New Zealand banned the company from participating in government contracts due to security concerns. Huawei has vehemently denied all allegations of spying.
Huawei has repeatedly denied it is controlled by the Chinese government, military or intelligence services.
Ren also responded to critics who claim that Huawei got to where it is currently through intellectual property (IP) theft and government support.
"The US has not developed that technology so from where should I steal it?" he asked.
"We are leading the US. If we were behind, Trump would not need to make so many efforts to attack us."
As the number of companies supplying Huawei with components and software falls, Ren added that Huawei would use its own products instead.
"The US manages its own companies. The US is not the international police - they can't manage the whole world. The rest of the world decides whether they should work with us based on their own business interests and positions," he said.
"If the US imposes further restrictions on us, we will reduce our purchases from the US and use more of our own chips. If American companies have permission from Washington to sell to us, we will continue to buy from them."
Last week, Trump also, for the first time,linked a dispute over Huawei, which he views as a threat to American security, with a deal to resolve the US-China trade war.
"Huawei is something that is very dangerous," Trump told reporters at the White House. "You look at what they've done from a security standpoint, a military standpoint. Very dangerous."
Ren told Bloomberg that there was no need for negotiation over the issue.
"The US has never bought products from us. Even if the US wants to buy our products in the future, I may not sell to them. There is no need for negotiation."
It seems the world is spiraling into turbulence. All
countries need to act prudently. They need to make as many friends as
they can and avoid becoming tools of other countries. They should also
cast aside illusions of using geopolitical methods to realize
development goals that can't be achieved economically.
As Huawei is pinned in the eye of the China-US trade war,
French President Emmanuel Macron claimed Europe won't capitulate to US
pressure to block the Chinese tech company. What is Europe's attitude
toward US demands? What impact has the trade conflict caused for Europe?
IN my last article, I took us along memory lane through the 60s and 70s when our education was world class. As I said, we prepared our bumiputra students at foundational levels in secondary residential and semi-residential schools to be able to competently compete on merit with others, at primarily international universities overseas.
After the social engineering of the New Economic Policy (NEP) quotas of the late 80s, our education system today is wrought by an overabundance of religious indoctrination, overtly in the curriculum and covertly in our public schools’ teaching environment. This was accompanied by the forcing of unqualified bumiputra students into local public universities that had to be graduated into the workforce in spite of them being mostly non performing. Gradings and exams had to bent to ensure large drop out numbers do not inundate the population. Instead, we flood the workforce with mediocre graduates who today fill the ranks of the civil service and government-link-entities top to bottom.
These graduates, in fact, today also fill up the whole levels of our education administration, teaching workforce and universities. Not all, but to most of them out there – you know who you are. Case in point are all the so-called bumi-based NGOs heads, university administrators including vice-chancellors who are somehow twisting their arguments into pretzels to defend the hapless Education Minister who just put his black shoes into his mouth with respect to the issue of a 90% quota for bumis in matriculation.
By now, everyone and their grandmother have seen the video-clip of our supposedly esteemed minister justifying the existence of matriculation quota in favour of bumis because the non-bumis are rich. To add insult to the wounds, he proudly claimed that private universities are mostly filled with non-bumis because non-bumis are better off than the Malays.
Let me today reiterate that this assumption can no longer be left unchallenged. It is patently untrue that all or even the majority of non-bumis are rich and are therefore of no need of government assistance. That the Malays are indeed so poor, that they are the only ones who are overwhelmingly in need of help.
This is a slap on the face of poor non-Malays and an insult to the many hard-working Malay parents who do not rely on government handouts and in general compete on their own merit.
Let us look at the reality, shall we?
Figures provided by Parliament in 2015, showed that bumiputra households make up the majority of the country’s top 20% income earners (T20), but the community also sees the widest intra-group income disparity. According to data from a parliamentary written reply, the bumiputra make up 53.81% of the T20 category, followed by Chinese at 37.05%, Indians at 8.80% and others at 0.34%.
So which groups overall are the top 20% income earners in the country? Answer: bumiputras by a whopping 16.76% to the next group, the Chinese!
However, when the comparison is made within the bumiputra group itself, T20 earners only comprise 16.34%. The remaining comprises the middle 40% income earners (M40) at 38.96% and the bottom 40% income earners (B40) making up the majority at 44.7%.
This means that in spite of almost 40 years of affirmative action, handouts, subsidies and quotas, bumis as a group has a large disparity between its haves and the havenots. That raises the question if it means practically none of the government assistance has in fact gone to help the bumis that truly needed help but has gone to further enrich those who are already having it all!
To the Malays, I say, “You should look into this disparity instead of pointing fingers to other Malaysians who work hard to uplift themselves without any help from their own government”.
Maybe because of your adulation of your Bossku, feudal fealty or religious chieftains that they are the ones that are taking up what is essentially yours to uplift your own lives?
After all the YAPEIM (Yayasan Pembangunan Ekonomi Islam), yes, another institution in Malaysia using religion to sucker people, the Director himself takes home RM400,000.00 in bonus and his senior executive draws another RM250,000.00 all by themselves. Must be one hell of a “pembangunan ekonomi Islam”.
The problem is not between the Malays and the other races. The problem is clearly within the Malay community itself. The help is not reaching the supposed target group. Why? So do not punish others with quotas that penalise the excellence of others for your own dysfunctions.
Now, contrast with the Chinese and Indian communities, where the M40 group makes up the majority.
Within the Chinese community, the T20 group makes up 29.66%, followed by the M40 group at 42.32% and B40 at 28.02%. As for the Indian community, the T20 group stands at 19.98%, followed by the M40 income earners at 41.31% and the B40 at 38.71%.
It is so clearly not true that all non-bumis are rich and therefore the quotas must remain to enable the bumis to compete on an equal footing. The quotas are no longer justifiable if it was ever justifiable in the first place. It is very clear from these data that equal opportunity to university places must be provided irrespective of race purely on merit. The help on the other hand must be in the form of scholarships or loans to those deserving based on the financial capability of each successful university entrant, as simple as that.
If a candidate does not qualify, he or she does not, race be damned. That person must then take a different route – vocational or skilledbased profession or any other road to success. There is nothing wrong with not being a university graduate if one is not qualified. Find your vocation and passion in a field that you will excel in.
The Government has no business populating a university and later the workplace with a single race based on the criteria of fulfilling quota. It makes no sense and it is the root of ensuring the downfall of both the administrative branch of government or even the overall machinery of the nation’s economy.
Maszlee claims that foreign university branches in Malaysia are filled up by non-bumis, therefore Malays need more places in public universities via matriculation. As such the Government instituted matriculation in 1999. He cited Monash and Nottingham as examples. Unfortunately, Monash was opened in KL in 1998 and Nottingham in 2000. That lie blew up in his face pretty fast, didn’t it?
But really why would private universities be filled up with mostly non-bumis? Can’t Maszlee see that if the local public universities are providing only 10% quota to non-bumis to enter via matriculation, an even tougher entry through STPM and none via UEC, that middle and low income non-bumis will have no other choice but to opt for the less expensive private local and branch universities to sending their children for overseas education?
They even can’t gain entry to public universities due to the quotas despite having better results than Bumis. Where do you expect them to go then Maszlee? I know of many non-bumis who are scraping their barrels to ensure they send their kids to further their studies either local or overseas. Many of them have fewer children because they know they will have to pay for their kid’s education in the future. With most if not all of the scholarships given to bumis do they have another cheaper option?
How much more heartless is your assessment of our fellow non-bumis’ predicaments can you get, my dear Maszlee?
I think Maszlee need to learn facts and have some critical thinking before opening his mouth. Being the education minister is not like teaching religion, where people are not going to fact-check you because they think you are a gift from God. An education minister with such thinking cannot be allowed to stay in that position much longer. It is untenable.
Interestingly of late, a number of those from the Malay academia have come to the defense of the hapless minister defending matriculation quota because of workplace imbalance in the private sector. I have to ask is this proof that our universities are headed by Malays who have no business graduating and being employed and now heading such academic institutions and organisations? Do they even realize the tenuous relations between entry quota into learning institutions vs recruitment variables?
We truly need to clean up the education ministry from top to bottom including at our public universities. Too many people with no brains sucking up to powers that be and playing the race and religion card. It’s enough to make you weep.
Back to our conundrum that is the Malaysian education, what then is our endgame?
1. Stop quota - period. Any type of quota. It does not work and it will destroy the capability of our public and private sector to excel. Merit must reign.
2. Go back to basics. Primary and secondary education are the foundation that will allow any persons of any race to compete on equal footing in order to enter vocational institutions, colleges, and universities. The rest will take care of itself upon them graduating and joining the workforce. Trust in our youth. The bumis are not incapable of excelling given the right foundation.
3. Bring back a Science, Mathematics and English-heavy curriculum for primary and secondary years. Go back to basics. These are foundation years. Do not worry about having the latest technology. Children will absorb that in their own time. Tertiary education is where skill-based knowledge is acquired. Foundational knowledge and critical thinking is honed before you leave high school.
4. Please leave religion at home. Teach it if you want but do it outside of normal school hours. Let our children be among their peers as human beings without any differentiation of beliefs and faiths. Let them celebrate their differences without adults telling them who is better than others. Show them all the beauty they possess without judgment.
5. We are all Malaysians. We all bleed the same blood and we all weep the same tears when we are capable but are unable to fulfill our potential because we do not have the financial means to achieve those goals. Help us irrespective of race. All of us contribute to our taxes. No one group should benefit more than the other because they are of a different ethnicity.
We will see that Malaysia will prosper with each race helping each other as Malaysians once and for all.
THE United States ranks low in the credibility stakes. It can no longer wax lyrical about free trade and fair play because the world now knows that when it finds itself facing stiff competition, it uses a ruling the magnitude of a nuclear bomb to retaliate.
Firstly, US president Donald Trump declared a national emergency and barred American companies from doing business with companies deemed a national security risk.
Then, companies like Google and Microsoft stopped making software and services available to Huawei, China’s biggest smartphone vendor.
The ban essentially means that future Huawei phones will no longer get Google play apps, YouTube, and almost certainly no updates to Android Q or other platform-level upgrades since these would require Google’s sign-off, too.
Sure, you can still make calls or use WeChat and other Chinese platforms, but for users in most parts of the world, the phone is pretty much useless.
Word is that Huawei poses a security risk, but no clarification has been forthcoming to what these threats include exactly.
There is a sense of déjà vu here.
The world was once told by the US and its allies that Iraq had weapons of mass destruction, but we learnt in the end there were none. Now, we have the Iran threat, but that’s another story all together.
From what little info has trickled into the worldwide web, the suggestion is that Chinese-manufactured devices have hidden back doors that could potentially allow an attacker to gain special access.
It sounds like a script excerpt from a James Bond movie, with spooks using a master password to break into high security facilities.
But incredibly, Huawei and ZTE Corp, another telecommunications equipment manufacturer, were cleared by the US House of Representatives permanent select committee on intelligence.
The two had been accused of providing “incomplete, contradictory and evasive responses to the committee’s core concerns” during their year-long investigation on the threat they supposedly pose to American interests.
In the end, the committee found no concrete evidence of infringement. But that didn’t stop the two companies from being labelled a national security risk and getting kicked out of the US.
IS, the German internet security watchdog, inspected Huawei laboratories in Germany and found no evidence of espionage, and The New York Times quoted American officials saying that the case against the company had “no smoking gun – just a heightened concern about the firm’s rising technological dominance”.
Rightly or wrongly, in the game of perception, the US has lost its moral ground. Thanks, in many ways, to an impulsive president.
Most of the world’s population thinks the bullying of Huawei is simply Trump’s hallmark. It isn’t about a security risk, but an economic threat.
Outside China, Huawei is arguably the most successful Chinese consumer brand so far. Thanks to a good and relatively cheaper product, it is now the second largest phone vendor in the world.
One strong accusation levelled at Huawei is that it enjoys Chinese government backing, and that China uses its spies to steal US technology for these private companies.
It’s a really warped perspective because, using the same logic, why is the US president taking such a hard line against a private company that’s merely selling phones?
The answer could well lie in the technology race.
Now, it’s about who launches 5G first, the next generation of mobile broadband imminently replacing 4G.
With 5G, we will see exponentially faster download and upload speeds. Huawei is widely renowned for being 12 months ahead of its competitors in the 5G race.
It began to develop its own 5G technology in as early as 2009. In 2013, Huawei hired more than 300 top experts from the wireless industry around the world and announced that they had invested US$600mil (RM2.5bil) in 5G research.
In 2016, Huawei set up a 5G product line for such devices.
What started as a three-man company now has thousands of employees engaged in 5G product development. Following this, in 2017, and then in 2018, Huawei invested almost US$1.4bil (RM5.8bil) in 5G product development.
The South China Morning Post has, however, also reported that apart from its tremendous commercial benefits, 5G – the fifth generation of mobile communication – is revolutionising military and security technology, which is partly why it has become a focal point in the US’ efforts to contain China’s rise as a tech power, and the Western nation’s allegations against Chinese companies is simply symptomatic of its insecurities.
“The future landscape of warfare and cybersecurity could be fundamentally changed by 5G.
“But experts say 5G is more susceptible to hacking than previous networks, at a time of rising security concerns and US-China tensions on various interconnected fronts that include trade, influence in the Asia-Pacific region and technological rivalry.
“These tensions provide the backdrop to controversy surrounding Huawei, the world’s largest telecoms equipment supplier.”
It’s also a fight between China and the US on who leads the artificial intelligence domain, as with 5G advancements, it means “whereas existing networks connect people to people, the next generation will connect a vast network of sensors, robots and autonomous vehicles through sophisticated artificial intelligence.
“The so-called Internet of Things will allow objects to ‘communicate’ with each other by exchanging vast volumes of data in real time, and without human intervention.
“Autonomous factories, long-distance surgery or robots preparing your breakfast – things that previously existed only in science fiction – will be made possible.
“Meanwhile, though, it is being identified by many military experts as the cornerstone of future military technology,” the newspaper reported.
As TV personality Trevor Noah says, humorously, in his show, the 5G war isn’t just about “loading an entire movie in three seconds but about the Chinese spying – which the US also wants to do.”
He sarcastically added that “the US is losing the 5G race and luckily, we have a maniac in our team who’s willing to play dirty.”
As the battle rages on, spilling into the already acrimonious US-China trade war, the controversy has become more bitter, and complicated, with the US egging its allies to ban Huawei from building its next generation of mobile phone networks. So far, Britain, Germany, Australia, New Zealand and Canada have either banned Huawei or are reviewing whether to do so.
Japan, a US ally, seems to have been dragged into the propaganda of persecuting Huawei, too.
In China, the actions against Huawei have stirred a storm of nationalism, with the Chinese calling for a boycott of iPhone, a reaction which could eventually affect other American and European products, at the rate things are escalating.
Even within the Chinese diaspora, the messages of unequivocal support for Huawei have gone viral in the world’s social media sphere.
The irony is that the iPhone is not only assembled in China, but its very inception starts in that country at a much earlier stage, and from a much deeper part of the earth, too.
At least 90% of rare earth minerals – naturally occurring solids whose combination comprises essential iPhone parts – are mined in China, notably in Mongolia, it’s reported.
“Lanthanides, scandium, yttrium and some other alien-sounding names at the bottom of the periodic table (remember your secondary school?) make the iPhone ‘light, bright and loud.’ Its colour screen, glass polishing, circuitry, speakers and vibration unit come from a mix of these rare earth minerals,” it says in Finances Online.
The report added that where American companies would take months to pool thousands of industrial engineers, and even more months to construct new assembly lines to accommodate a trivial but urgent change in an iPhone spec (say, its glass panel needing to curve to hatch on the body six weeks prior to launching), it only takes 15 days in China to do the same.
“To put it in perspective, one production line in China can assemble 72,000 iPhone 5 back plates daily; one factory can have four to five production lines and China can have as much as a hundred of these factories, opening or closing a few of them depending on the current demand.
“The last part – opening and closing plants like a mom-and-pop store – is almost impossible in an American economy.
“It is no longer a city counting the number of manufacturing plants it has, but the manufacturing plant can be counted as a city in many Asian economic zones.”
And it’s common knowledge that Mickey Mouse merchandise is made in China, and likewise all the branded sportswear sold globally. The profits these companies are raking in are simply down to the low cost of operation.
Trump should know and do better. Instead of threatening and bullying Huawei with trumped up charges, he should urge American companies to be more competitive, make better products and keep prices low.
I am dumping my iPhone, upgrading my South Korean Samsung and for the first time, getting myself a Huawei. I hear the camera is really good, and it doesn’t even need a zoom lens for magnification. And that sophistication comes from a license to thrill.
By Wong Chun Wai
Wong Chun Wai began his career as a journalist in Penang, and has served The Star for over 27 years in various capacities and roles. He is now editorial and corporate affairs adviser to the group, after having served as group managing director/chief executive officer.
On The Beat made its debut on Feb 23 1997 and Chun Wai has penned the column weekly without a break, except for the occasional press holiday when the paper was not published. In May 2011, a compilation of selected articles of On The Beat was published as a book and launched in conjunction with his 50th birthday. Chun Wai also comments on current issues in The Star.
US President Donald Trump on Thursday announced a $16
billion aid package for farmers to offset their losses from the trade
war with China. He said the package "will be paid for by the billions of
dollars" from tariffs on Chinese imports.
All Chinese companies wishing to get to the high-tech
mountaintop should learn from Huawei's composed example. If only there
were a group of Chinese companies sharing intellectual property with
foreign partners, then certain malicious forces would hesitate at a
crackdown.
China's economic potential is far greater than that of
the US, the largest economy. There is no doubt that China's economic
prospects are the best in the world. These facts drive China's core
competitiveness. They will make Washington feel its ability falls short
of its wishes when it comes to containing Beijing.
Chinese people do not know whether we should call US
approaches hegemonic politics or profiteering politics. But in short,
they are crooked means. The threat of tariffs will not work. Neither
will US threats against Chinese companies create a shock wave against
China. The US is picking a wrong opponent at a wrong time. It will find
no way of crafting a good result from a strategic mistake.
The US is having a profound effect on the global economic
order by abusing national security and trampling on commercial
principles. Current US administration is destroying the reputation and
national image that generations of Americans have built. Such arrogance
and hegemony are by no means good signs for the US.
New world order: People visit the bund in front of Shanghai's financial district of Pudong. The US-China trade war looks like the beginning of a profound break in the global order. As China and the United form two opposing economic and geopolitical coalitions, the rest of the world will be forced to choose. - Reuters
President Donald Trump has long said the goal of his trade policy is simply to get better deals for Americans. But as the trade war intensifies, it seems increasingly likely that his policies will lead to something more: a lasting break with China and a new alignment of global power.
First, consider the evidence for the break.
The current impasse in trade talks was sparked by a sudden change in terms on the part of the Chinese negotiators.
This change likely caught the administration off guard, but Trump’s response is notable: He immediately ramped up tariffs, then announced a ban on business with Chinese telecommunications firm and national champion Huawei Technologies Co.
These actions have backed Chinese President Xi Jinping into a corner and turned the trade dispute into a matter of Chinese national pride.
This limits the possibility not only of a quick resolution, but also of the chances that the Chinese people will accept any concessions to the US.
Trump’s handling of this situation stands in sharp contrast to his negotiating strategy on other issues.
Though the president railed against NAFTA throughout his campaign, he’s touted its replacement as a huge success, even though it is only cosmetically different, and has been willing to suspend his tariffs on Canada and Mexico to ease its passage through Congress.
Likewise, Trump has been more than willing to trumpet his successful negotiations with North Korean leader Kim Jong Un even though the evidence for such success is thin.
Meanwhile, the president’s tough talk against Europe and Japan for their trade practices, and against NATO allies for their defence spending, has been mostly bluster.
When it comes to China, however, the president is doubling down.
He has encouraged US supply chains to move out of China and established subsidy programmes to cushion farmers from the effects of a protracted trade war.
Which leads to the long-term implications of this battle. A protracted trade war would almost guarantee a global realignment.
Supply chains that run through both the US and China would constantly be subject to disruptions, so global manufacturers would have to decide whether to pursue an America-centric or China-centric strategy.
That’s already the case in the digital sphere, where Chinese restrictions on the Internet divide the world into two parts: that which is served by US tech giants such as Google and Facebook, and that which relies on Chinese firms such as Baidu and WeChat.
China’s threat to cut off US access to rare-earth minerals points to a potential bifurcation in commodities markets as well.
The trend is clear: As China’s economic and geopolitical power grows, countries within China’s sphere of influence will feel increasing pressure to integrate their economies with Chinese supply chains and multinationals rather than American ones.
At the same time, as my Bloomberg Opinion colleague Tyler Cowen points out, the rise of China is a main driver of populist sentiment in the UK and Australia.
This creates political pressure in those countries for further isolation from China.
In the US, Trump has made it clear that he sees the trade war with China as politically advantageous for him, and he’s probably right.
It’s probably also true that this anti-China sentiment will outlast him.
Break in global order
Add up all these factors, and the US-China trade war looks like the beginning of a profound break in the global order. As China and the US form two opposing economic and geopolitical coalitions, the rest of the world will be forced to choose.
Maybe the European Union can form a third unaligned pole, as France and Germany’s membership in the EU (and the UK’s absence from it) provides them with the negotiating power to avoid falling under the Chinese or American sphere of influence.
Of course, in some ways this type of multipolar alignment would be a return to the past. The dual-superpower world that existed for much of the second half of the 20th century was always an exception, and the era of American supremacy that began after the collapse of the Soviet Union was never going to last.
Until recently, however, a new kind of bipolar arrangement seemed possible: a kind of competitive partnership between China and the US, with the EU playing a supporting role.
The events of the last few weeks have left that looking increasingly unlikely. — Bloomberg Opinion
By Karl W. Smith , a former assistant professor of economics at the University of North Carolina’s school of government.
China now has no choice but to pursue technological independence, and will burn the cash to achieve it.
... A similar process took place when ZTE Corp. was banned from buying
U.S. products after reneging on a deal to settle charges of breaking
trade sanctions. ... The U.S. ended up
Chinese
President Xi Jinping said that "we are on a new Long March now" during
his inspection tour of Jiangxi Province this week and encouraged people
to gain strength from the spirit of the Long March to overcome
difficulties and obstacles, China's state media outlets reported on
Thursday.
