Samstag, 23.03.2019 07:17 Uhr

PRC, USA, Italy and the Year of the Pig

Verantwortlicher Autor: Carlo Marino Rome, 27.02.2019, 09:28 Uhr
Kommentar: +++ Politik +++ Bericht 4090x gelesen

Rome [ENA] Chinese President Xi Jinping is expected to visit Italy by next march. And Italy is expected to sign various agreements with the People's Republic of China.It’s important to point out that in Italy, Huawei the Chinese leading global provider of information and communications technology, has been active since 2004 and controls a third of the smartphone market, which in the Peninsula is worth about 1.5 billion euros.

The group considers Italy a strategic country : only in 2016 it invested € 162 million. Today it is developing the 5G network in Milan and in the Bari-Matera area, where the investment is 60 million Euros. It is working with 38 private and state owned partners to realize 41 projects ranging from health to safety, from surveillance to energy, from transport to smart cities. Huawei has signed agreements with Terna, Enel, Fastweb, Ferrovie dello Stato, Telecom and provides technology for all 16,000 Italian post offices. It also finances two large research centers: one in Segrate (near Milan) specialized in the microwave technology based on 5G technology, the other, inaugurated in 2016, in Pula, Sardinia,

where it has invested 20 million for the development of smart cities. Huawei utilizes also the first European super-computer for the management and control of all the services of the City of Cagliari: the goal is to transform Sardinia into the first «smart region». Sources of italian intelligence, however, report that Sardinia is also a valuable observatory, because the island hosts military bases and above all because it’s there all NATO European forces are trained. So the visit of the Chinese President Xi Jinping has to be observed also taking into account italian relationships with the USA. In fact a somewhat hostile attitude towards China is now widespread in the United States and it is common to the republican and democratic majorities

of the new Congress. The challenge between the United States and the People’s Republic of China seems predestined to be prolonged and in many ways to worsen although the commercial truce is likely to be transformed into a formal agreement by early March. It’s a positive fact, but that will not be the ratification of the end of the acrimonious confrontation between the two great world economies, which went far beyond commercial exchanges. It is a real all-encompassing geopolitical challenge, which risks deteriorating and can shake the whole global economic and political structure.

After the barrage of duties last year, the United States and China welcomed 2019 ( the Chinese year of the Pig: in Chinese culture, pigs are the symbol of wealth) by launching a commercial negotiation in Beijing as result of the "truce" signed at the G20 in Buenos Aires last December by the two presidents Donald Trump and Xi Jinping. Each new tariff has therefore been frozen and a commercial agreement between the two countries will have to be ratified by March 2nd. The slowdown in the global economy and the collapse of the Chinese and American stock exchanges at the end of last year persuaded Washington and Beijing to start cooperating again.

One of the most serious threats to the continuation of the current global growth is characterized by the probable worsening of the commercial war between the two World's largest economies. While American statements concerning the agreement were very positive, chinese reaction was more cautious. Anyway, if the news, immediately after the meetings had been filtered, an official visit to Washington last January of Liu He, chief Chinese negotiator and Xi Jinping's trusted man, could be interpreted as an endorsement of Beijing's interest in the success of the negotiation. On the other hand, the reaction of the financial markets and stock exchanges was very positive, and they immediately appreciated the reduction of tensions.

One of the most serious threats to the continuation of the current global growth is characterized by the probable worsening of the commercial war between the two World's largest economies. While American statements concerning the agreement were very positive, chinese reaction was more cautious. Anyway, if the news, immediately after the meetings had been filtered, an official visit to Washington in January of Liu He, chief Chinese negotiator and Xi Jinping's trusted man, could be interpreted as an endorsement of Beijing's interest in the success of the negotiation. On the other hand, the reaction of the financial markets and stock exchanges was very positive, and they immediately appreciated the reduction of tensions.

Central to the negotiations are the demands of the Americans, who have two goals on paper: the first, to push China to import more from the United States and thus reduce the bilateral trade deficit. The second, to ensure American companies better access and treatment on the Chinese market, putting an end to a series of measures and practices of Beijing considered vexatious - not only by the Americans - in terms of forced technology transfer, poor protection of intellectual property and so on . The satisfaction of the first group of requests does not present significant obstacles.

Already in the past, the Chinese government has repeatedly declared itself willing to increase, even in significant quantities, imports from the United States of agricultural, energy and other products. It is assumed, for example, that the Chinese are ready to buy large quantities of American soybeans, from 6 to 8 million tons. And the credibility of these promises is strengthened by the still highly centralized nature of Chinese international trade. The greatest difficulties concern the second group of American requests, because they are very heterogeneous and veined with ambiguity. On the one hand they appear to be directed to end predatory behaviors by China, strongly criticized by many other countries and by the European Union.

On the other hand, the interest seems to be much higher, to modify or even to prevent policies and interventions in the industrial and technological fields, such as those linked to the multi-year development plan Made in China 2025. A plan that wants to favor the achievement, in the next decade, by the Chinese production system of the global hi-tech frontier, in terms of networks, artificial intelligence, robotics and big data. Because of its strategic nature, the Chinese government does not consider it negotiable. While an agreement appears to be achievable on the subject of greater imports of American products and possible modifications of interventions,

practices and predatory behavior on the Chinese side, no real mediation seems possible where the American demands give the impression to block or slow down the advanced industrial and technological development of China. The collision between USA and PRC is no longer limited to trade and the US trade deficit, but it includes a series of issues that predominantly affect new technologies and global technological supremacy in the coming years. In addition to the disruptive effects it could have on the global economy, the risk is, as the story of the Chinese telecommunications giant Huawei clearly shows, to divide the world and the countries into two blocs: a resurgence of the first decades after World War II.

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