TikTok and the Sino-American tech split

OVER THE5G5GSMIC past few years countless predictions have been made that the global technology industry will suffer a painful rupture because of tensions between America and China. Real damage has been surprisingly hard to spot. Last year Apple made over $100m of sales a day in China, while Huawei reported record revenues despite America’s campaign to cripple it. Investors have piled into tech companies’ shares, buoyed by the prospect of new technologies such as and a pandemic that is forcing billions of customers to spend more time and money online. Judged by sales, profits and shareholder returns, it has been a golden era for American and Chinese tech. The industry now has a colossal market capitalisation of $20trn and accounts for a quarter of the world’s stockmarket value.Yet if you examine the events of the past two weeks you can sense the split that is about to come. On July 6th Mike Pompeo, America’s secretary of state, said that the administration was considering banning TikTok, a Chinese-run app that is wildly popular in the West. This followed India’s decision a week earlier to prohibit it, and 58 other Chinese apps, after lethal brawls between soldiers in the Himalayas. Britain and France are considering sidelining Huawei from their networks (see ). Between July 6th and 7th Facebook, Google, Microsoft and Twitter all said that they will stop co-operating with Hong Kong’s authorities for the time being, because of the introduction of China’s brutal security law there. And , China’s aspiring semiconductor champion, has just said that it will raise $7bn in a state-supported listing in Shanghai—it delisted from New York last year (see ). The proceeds will be used to supersize China’s home-grown chipmaking capacity.