Alibaba Group Vice Chairman Joseph Tsai is highly critical of the United States policy on technology companies, having said as much during a Bloomberg interview at this week’s Rancho Palos Verdes, California-based Code Conference. Mr. Tsai specifically named Democratic Senator Mike Warner (VA) as one high-profile American politician who has what he deems is a fundamental misunderstanding of China’s technology policy outlined as part of the “Made in China 2025” strategic plan announced by Beijing three years ago. The initiative is presently threatened by the Trump administration’s efforts to impose tariffs on up to $50 billion worth of imports from the world’s second-largest economy.
“here’s nothing wrong with a country wanting to up its tech and be more innovative. From the Chinese perspective, we see a lot of people who want to stop China from doing that,” Mr. Tsai said. Numerous Chinese companies were previously accused of patent infringement and posing security risks in the West, whereas Beijing itself has regulations that don’t allow for a market that’s free to a degree which would provide foreign competitors with realistic chances of operating in the Far Eastern country independently. China’s strategic plan to become less reliant on technology imports is still far from being completed, as evidenced by the example of ZTE, one of the country’s largest telecom and smartphone companies whose operations came to a grinding halt in a matter of weeks after the U.S. Commerce Department issued a denial order preventing it from purchasing American hardware and software over the next seven years. The ban was given as a reaction to ZTE’s failure to adhere with the terms of a 2017 settlement over its violation of international trade sanctions placed on North Korea and Iran, with the Chinese company arguing the move was unfair because the issue that prompted it was self-reported and accidental.
Tencent Chief Executive Officer Pony Ma recently described the ZTE episode as a “wake-up call” regarding the state of China’s technology industry, speculating more domestical investments will be made in the near future. China is the world’s largest importer of semiconductors, with its companies still being largely unable to produce solutions rivaling foreign technologies, with the sole exception being Huawei’s subsidiary HiSilicon.