Chinese tech giants cautiously optimistic on Biden’s win
Detention of Meng Wanzhou, bans on TikTok and WeChat considered indicators for reevaluating US-China relationship: experts
Published: Nov 09, 2020 07:53 PM Updated: Nov 09, 2020 09:00 PM

People learn about Huawei 5G products during a Huawei roadshow in Madrid, Spain, Nov. 5, 2020. Huawei, China's leading tech company, launched a roadshow here on Thursday to provide visitors with hands-on experience of its 5G technology. (Xinhua/Meng Dingbo)

 Major Chinese tech giants hold a "wait-and-see" attitude toward a likely Joe Biden presidency in the US as some have been facing a yearlong crackdown amid the US-initiated tech war against China while shares of major Chinese tech firms jumped on Monday, displaying a bullish market sentiment on the media-announced outcome of the US election. 

Most employees and senior executives from Chinese tech firms that have been targeted by the Trump administration for years - including Huawei Technologies, Tencent Holdings and ByteDance's TikTok - reached by the Global Times on Monday do not believe that Biden will relax the crackdown on Chinese firms as the China-US rivalry is a long-term preoccupation for Washington. 

Still, Biden's policy adjustments on China might lead to a situation where some questions of concern - such as the detention of Huawei's Meng Wanzhou and the ban on WeChat - are put back on the negotiating table.

"There won't be any impacts in the short term; maybe we'll see the currently tense situation ease in the near future, but long-term confrontation won't change," a senior executive from Huawei, who preferred not to be identified as he was not allowed to speak to the press, told the Global Times on Monday. 

The question of Huawei is widely seen as a major bargaining chip in the escalating US-China tensions in terms of technology, and it has also been exploited for American companies' maximum benefits, he said. 

The surge of Chinese stock markets, especially tech-related stocks, also reflected a widely shared bullish sentiment on Biden's win, according to some market analysis. For example, the semiconductor sector soared on China's A-share market shortly after the market opened in the morning, with Huawei concept shares surging about 3 percent and the price of Huawei HiSilicon concept stocks gaining 4 percent on Monday. 

Such positive reaction also echoed Silicon Valley's celebratory mood during the weekend as some representatives of the American tech giants reacted positively to Biden's win. 

Cisco head Chuck Robbins expressed his willingness to work with the new administration and Microsoft President Brad Smith called for unity - a key takeaway of Biden's first speech on Saturday upon securing victory in the presidential race.  

While some suggested Biden's political rhetoric on technology could translate into furthering an already intense decoupling between the two countries, other Chinese experts warned that the scope of crackdown on China's high-tech companies would be narrowed in the long run, offering a temporary "breath of relief" to some firms. 

Competition of innovation 

"A China-US 'tech rivalry' under the Biden administration would be much more rational, smart, and without much political interference from such an extreme extent," Fang Xingdong, founder of Beijing-based technology think tank ChinaLabs, told the Global Times on Monday. 

For the next four years, it will be a rules-based competition between China and the US in terms of each country's innovation capabilities rather than nasty "force-to-sell" tactics that have been applied recently on TikTok or the unjustified ban on WeChat, he noted. "More importantly, Meng may have an opportunity to return to China."

Some Chinese experts believed that the essential difference between Biden and Trump would be that Biden would not follow Trump's strategy in entangling Chinese firms over non-critical technology, but Biden won't be quick to relax his country's tough stance on core areas such as aerospace, quantum computing and artificial intelligence. 

"Chinese firms' international businesses, especially those in the US market, which have been severely cracked down under Trump, might usher in fresh opportunities," a former employee of Tencent, who's been closely watching the fate of WeChat, told the Global Times on Monday

Although it's still unclear what Biden's policies on high tech will be, given the US now enters a two-month transfer of power period, some Chinese representatives believe he won't take any moves as extreme as those of Trump did, but the bipartisan perspective on China has already reached a consensus on fending off the rise of China in high technology.

"It is not unlikely for Biden to repeat the Trump way — which does harm not only to its foe but also to the US itself. For example, because of the trade war, US importers of Chinese products have to bear higher costs caused by tariffs, and in Huawei's case, US Qualcomm lost its major client…," a senior executive of a Chinese high-tech firm, who's now based in California, told the Global Times on Monday.

There are 70 days to go until the inauguration of the new president on January 20, and some industry representatives and observers pointed out that some risks, even a "black swan" event, staged by incumbent US President Trump, could severely undermine future China-US ties. 

It's likely that Trump will issue executive orders to ban Chinese apps, WeChat and TikTok in particular, in his final days as top US leader, Shen Yi, an expert on US politics and international relations at Fudan University in Shanghai, told the Global Times on Sunday, as the incumbent president would logically use his last two months in office to solidify the key policies of his presidency. 

Such a mentality of creating surprising scenarios also creates more risks for some tech giants that have been processing lawsuits in the US, including Tencent's WeChat, TikTok and Huawei. 

Future with uncertainties 

In the latest move in October, the Ninth Circuit Court of Appeals in the US rejected a US Department of Justice (DOJ) request allowing the government to immediately ban Apple and Google from offering Tencent's WeChat for download in US app stores. The panel of the court said the US government had not demonstrated it would "suffer an imminent, irreparable injury during the pendency of this appeal, which is being expedited." 

The DOJ is expected to continue to appeal in the Ninth Circuit Court, no matter whether the move is based in strong will or just a gesture during the transfer of power, a lawyer familiar with the case told the Global Times on Monday.

"If Biden, who's now president-elect, could withdraw Trump's executive order, then the case is completely over; otherwise the legal process will continue," said the lawyer.

The appeals court said the WeChat case will be placed on its January 2021 calendar.

Apart from WeChat, another Chinese-owned app, the popular video-sharing platform TikTok, has also seen its destiny become unknown in the US.

US District Judge Carl Nichols for the District of Columbia on Wednesday said he was uncertain if he had a legal basis to bar the US Commerce Department from imposing restrictions on TikTok after a Pennsylvania judge already blocked the government's plan at the end of October.

For those facing legal battles in the US, the best way to deal with uncertainties is focusing on their own matters. "Not only Huawei, but also other Chinese tech firms can switch to a different channel now, hopefully, a good channel," another senior executive from Huawei, who only spoke on the condition of anonymity, told the Global Times on Monday. 

There will be three hearings listed concerning the detention of Meng by Canada at the request of the US before the end of 2020, with seven witnesses expected to present at court, according to sources close to the matter. 

Handling the arrest of Meng, for example, will be a major indicator in assessing the future of China-US relations, Shen said, referring to the possibility of surprises in China-US relations during the power transition period. 

"Hopefully, Meng will be released," the senior employee said, "but right now it's all about the politics."

Li Qiaoyi also contributed to the story