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Decoupling tech supply chains would do more harm than good

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For a technology sector that would much prefer to focus on growth over geopolitics, the push for U.S.-China “decoupling” poses an inescapable threat. The fuzziness of the concept only increases the danger.

But during the administrations of both George W. Bush and Barack Obama, there was a broad push to engage in dialogue and find common ground between the world’s two biggest economies. As China emerged as a leading global economy and became an increasingly important trading partner to the U.S., (accounting for 2.5% of U.S. imports in 1989 and rising to a peak of 21.6% in 2017), there were moves to incorporate it into the U.S.-led global trading system.

Regardless of what was labeled as produced where, the bottom line was that a well-developed Asian supply chain incorporated China as a major player. With increased engagement, however, and very different economic systems, the points of economic disagreement between China and the United States accumulated. During the Trump administration, dialogue took a back seat to new trade barriers. The United States applied tariffs on hundreds of billions of dollars of Chinese imports and China responded with barriers of its own. Although the Trump tariffs were initially cast as temporary measures meant to achieve finite policy objectives, some key policymakers within the Trump administration saw value in diminished interaction between the two countries.

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