The US and China are currently locked in a battle for global supremacy and even a deadly pandemic has failed to prevent tensions from ratcheting up. Arguably on an inevitable collision course, the pressure has been amplified by US president Donald Trump’s trade war. As Mr Trump seeks to redress perceived imbalances, the repercussions have reverberated across international equities markets.
A key battleground is technology, and companies are finding themselves increasingly caught in the middle of this superpower struggle. Recently we have seen a step-up in the campaign against Huawei, TikTok has found itself at the centre of a national security storm and US tech players are navigating how to conduct business in Hong Kong and mainland China while satisfying both Washington and Beijing.
A new report by Deutsche Bank says we could ultimately end up with a “tech wall” – parallel US and Chinese tech regimes that split the world into two camps. If this ‘tech cold war’ continues unabated, Apjit Walia, Deutsche Bank’s global head of tech strategy, says it could cost $3.5 trillion (£2.7 trillion) over the next five years to decouple the existing tech infrastructure.