US must engage China’s ‘wickedly competitive’ hi-tech firms: trade group leader

Mainland companies striving to overcome slower domestic growth and oversupply while multinationals need R&D talent to stay globally viable

Reading Time:2 minutes

A silicon wafer during the photolithography process inside a computer chip production machine. Semiconductor manufacturing has been targeted by both the US and China with trade restrictions. Photo: Shutterstock

Published: 5:36am, 11 Dec 2024Updated: 6:02am, 11 Dec 2024

China’s increasing support for its hi-tech companies amid rapidly tightening trade restrictions by Washington and Beijing have spawned “wickedly competitive” local firms that multinational entities must engage with to remain globally competitive.

Yet new limits announced by the two sides in recent years, and particularly over the past week or so, make such engagement as partners, suppliers or competitors all but impossible.

This was one of the final warnings that Craig Allen, the outgoing president of the US-China Business Council, issued on Tuesday, ahead of his departure from the non-profit industry association that counts General Motors, Honeywell and Walmart as members.

For US companies and other multinationals operating on the mainland, “local Chinese peers, especially Chinese private companies, are … becoming wickedly competitive”, said Allen in a keynote address to the Centre for Strategic and International Studies.

Craig Allen has served as president of the US-China Business Council since 2018. Previously he held senior positions in the US government, including at the Department of Commerce and the American Institute in Taiwan.

This was happening as they work to overcome slower domestic growth and oversupply, the former senior US government official added.