Jun 10, 2021
How America Turned the Tables on Huawei
This news has been received from: Voice of America
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Excitement over China’s digital advances was rampant when Keith Krach last visited China as chief executive of the highly successful software company DocuSign, with its more than 400 million users in 188 countries.
“I saw a lot of new technology. I saw the drone swarm technology. Everybody was telling me to download Tencent every 30 minutes,” Krach said.Tencent is the multinational conglomerate behind China’s popular WeChat app.
That was in December 2017. Today Krach is near the top of a list of Americans who are banned, along with their close relatives, from ever again visiting China or doing business with Chinese entities.
Former Secretary of State Mike Pompeo “was number one, [former trade policy adviser Peter] Navarro number two, I'm number three" on the list topped by former Trump administration officials, Krach said in a recent interview.
Twenty-eight people were hit with the sanctions, which were announced January 20, minutes after U.S. President Joe Biden was sworn in.
'Shot across their bow'
While the sanctions were focused on those leaving office, Krach said he believed they were meant as a warning to members of the incoming Biden administration, including Secretary of State Antony Blinken and White House Asia coordinator Kurt Campbell.
“That’s a shot across their bow — you know, just enough to make them hesitate — and that makes a difference. For me, it doesn’t affect me. I’m at a different station in life,” Krach told VOA during a recent visit to Washington.
Krach became a U.S. undersecretary of state for economic affairs in March 2019 and stayed on the job until the end of President Donald Trump’s term.
“My charge was to develop an operationalized global economic security strategy to drive global economic growth, maximize national security and combat China’s economic aggression,” he said.
A year into the job, “the issue of 5G became really urgent,” he said. “Huawei had announced that they had 91 worldwide contracts, 47 in Europe. It looked like they were unstoppable, [that] they were going to run the table.”
Krach’s job was to turn the table.FILE - Information on Huawei's 5G equipment is seen on a screen at the World 5G Exhibition in Beijing, China, Nov. 22, 2019.
The United States started warning allies and partners in 2019 that having the Chinese telecom firm Huawei build their 5G telecom infrastructure risked exposing their citizens’ and their official data to Chinese state surveillance. The Trump administration argued that countries should keep Huawei out, both for their own sake and for the sake of collective security among democratic allies.
Huawei has repeatedly asserted its independence from China’s government, even though it is branded in China as a “state champion” and has a Communist Party administrative department embedded in its corporate structure.
One by one, Krach and his team enlisted dozens of allied countries and telecom corporations in what became known as a Clean Network. “By the time we’re done, [Huawei] had probably about a dozen and a half” contracts left, down from nearly 100, Krach said.
Building what U.S. officials called an “alliance of democracies” to ensure technological independence from Chinese state-backed firms wasn’t always easy. If, as Krach said, the Chinese authorities tried to intimidate incoming U.S. officials, the same scare tactics were used on government officials and businessmen in other countries.
Fear of retribution
“It was pretty clear in those bilateral meetings that everybody was afraid to talk about China or Huawei. The elephant in the room was China’s retribution, retaliation,” Krach recalled. “So a big part of the Clean Network is [providing] a ‘security blanket’ because there’s strength in numbers and there’s power in unity and solidarity.”
NATO Deputy Secretary-General Mircea Geoană and EU Commissioner for Internal Markets Thierry Breton were natural allies who needed no convincing that the political, economic and security alliance among democracies was only “as strong as our weakest link,” Krach said.
But to effectively counter Huawei, the alliance of democracies also needed to control the technology and hardware needed to build 5G systems. Krach said the Taiwan Semiconductor Manufacturing Company was persuaded to build a cutting-edge plant in the U.S. while the Trump administration put in place export controls depriving Huawei of essential semiconductors and related technology.FILE - A leaflet that asks employees to protect the company's confidentiality is seen at a reception at the Taiwan Semiconductor Manufacturing Company, in Hsinchu, Taiwan, Aug. 31, 2018.
“First you see Huawei beginning to lose the momentum, then you see the tide beginning to turn, then the tide is turning, then the tide is turned,” he said.
Krach believes that confronting the “China challenge” will require a continuing bipartisan effort by the two U.S. political parties, and he hopes his efforts as undersecretary for economic affairs have provided a “head start” for the Biden administration.
He also hopes the “alliance of democracies” can continue to flourish, and that Biden’s “buy American” initiative can be combined with the purchase of products from allied nations and partners. “Why not do free trade among the Clean Network?” he said.
Journey from Ohio
Krach was born in April 1957 in what he described as “small-town Ohio.”
“My father ran a machine shop, and my mother was a teacher," he said. "My dad’s customers were suppliers to the Big Three car companies in Detroit, and his fortunes were tied to theirs. ... In boom times, we scrambled to fill big orders; in bad times, I was his only employee.”
Krach told members of the U.S. Senate at his confirmation hearing that his father “dreamed that I would get some ‘college knowledge’ and return as an engineer to help him grow the machine shop into a big company of 10 employees.”
The son never returned to work with dad in Ohio but instead went on to become the youngest vice president at General Motors and later a billionaire inventor and corporate CEO before joining the State Department.
Krach is now back in California but takes satisfaction in his time in government service.
“We say in Silicon Valley, 'Corporate responsibility is social responsibility.' Well, corporate responsibility is also national security, because companies wouldn’t be around without the United States, without democracy, without capitalism,” he said.
News Source: Voice of America
Tags: the trump administration the trump administration biden administration secretary of state the united states national security independence the united states global economic members the sanctions chinese state beginning and partners the chinese
Op-ed: In Europe, Biden laid the foundations for an alliance to preserve democracy and check authoritarians
Russian President Vladimir Putin and U.S. President Joe Biden attend a meeting at Villa La Grange in Geneva, Switzerland June 16, 2021.SPUTNIK | via REUTERS
To comprehend the audacious ambition behind President Joe Biden's Europe trip this week, think of him less as U.S. commander-in-chief and more as the democratic (small "d") world's physician-in-charge.
Eighty years ago, as far fewer democracies were under siege by surging authoritarian forces, Franklin Roosevelt in his famous "Four Freedoms" speech to Congress in 1941, proclaimed himself Dr. Win-the-War. Now as democratic world faces a renewed assault, it's Biden's turn to be Dr. Save-Democracy.
Having repeatedly provided his diagnosis of the cancers endangering global democracies, Biden this past week accelerated the course of treatment. Like any good physician, he understands cure and recovery remain uncertain after so many years of invasive and metastasizing disease.
Waiting any longer would have ensured the patient's failure in what Biden has diagnosed as an "inflection point" in the historic and systemic struggle against authoritarianism. As he said this week at NATO headquarters in Brussels, laying out a theme underpinning his entire presidency: "We have to prove to the world and our own people that that democracy can still prevail against the challenges of our time and deliver for the needs of our people."
While the 78-year-old President's messaging and his remarkable endurance on the trip's five whistle stops were impressive, any U.S. leader can line up a similar set of meetings. They included his bilateral with British Prime Minister Boris Johnson, followed by the G-7 gathering of the world's leading industrial democracies, then the meeting of NATO leaders, a U.S.-European Union summit and finishing in Geneva with Russian President Vladimir Putin, the embodiment of what Biden's fighting.
More notable is what Biden did with them. Through painstaking planning and negotiations, his team and its partners produced dozens of pages of agreements, communiques and future commitments. All of it was designed to provide a narrative thread and to provoke common cause among the world's leading democracies.
Behind all that rests an overriding Biden administration focus on China as the challenge of our time. Unlike the Trump administration, which put itself in conflict with Europe and China simultaneously, the Biden administration has gone out of its way to rally Europeans to its side in the competition with China, even if compromise is required from individual countries and an entire European Union that count China as their leading trade partner.
The agreements achieved this past week included a Carbis Bay G-7 summit communique that contained, among much more, commitments to provide the world a further billion doses of Covid vaccines this year, a plan to reinvigorate member economies and a commitment toward a global minimum tax.
They included a U.S.-EU summit statement, perhaps the most underreported and underestimated of the week's agreements, which established a number of dialogues that could forge closer cooperation on everything from Covid relief and climate change to technological cooperation and China.
"We intend to continue coordinating on our shared concerns, including ongoing human rights violations in Xinjiang and Tibet," the statement said, "the erosion of autonomy and democratic processes in Hong Kong; economic coercion; disinformation campaigns; and regional security issues."
The move to end a 17-year trade and tariff dispute between Boeing and Airbus also has the rising competition with China as its motivating factor. Even the three-paragraph U.S.-Russia Presidential Joint Statement on Strategic Stability had China in its sights, aimed at launching a bilateral Strategic Stability Dialogue whose aim would be to create a more predictable environment with Moscow so that Washington's energies could be focused more squarely on Beijing.
Lingering beneath the surface of all President Biden's meetings, however, were enduring doubts about the durability of this renewed American commitment to alliances, democratic partners and a common cause – producing some understandable whiplash among heads of state and government who had participated in meetings of a far different tone with President Trump.
Europeans have reason to wonder what the next U.S. elections might bring, as Trump and his allies still refuse to accept his electoral defeat and claim fraud. They also have their own electoral uncertainties, with German elections in September set to end Chancellor Angela Merkel's nearly 16 years of leadership, and French President Macron facing local elections Sunday that could provide a preview for his showdown next year with Marine Le Pen.
In no small part, credit those uncertainties for Biden's large degree of success with his partners last week, who were only too eager to embrace the change. What the Trump administration demonstrated, as have the first months of the Biden presidency, is the continued dependence of global democracies upon U.S. leadership. So why not leverage the present to put as many agreements and habits in place as possible, hoping they might be enduring.
In that spirit, the week started appropriately with the New Atlantic Charter signed with British Prime Minister Johnson, a useful reminder of what a historic difference an internationally engaged United States can make on the 80th anniversary of the original Atlantic Charter agreed by U.S. President Franklin Roosevelt and British Prime Minister Winston Churchill.
"Our revitalized Atlantic Charter," reads the new document, "building on the commitments and aspirations set out eighty years ago, affirms our ongoing commitment to sustaining our enduring values and defending them against new and old challenges. We commit to working closely with all partners who share our democratic values and to countering the efforts of those who seek to undermine our alliances and institutions."
It is worth recalling that almost four full months before the formal U.S. entry into World War II Roosevelt and Churchill agreed to the original charter, outlining their ambitious common aims for the post-war world, and making clear U.S. support for the British war effort, on August 14, 1941.
It is also worth reflecting on what sort of world might have emerged had the U.S. not stepped forward.
With the post-war liberal order threatened, the New Atlantic Charter could serve as a clarion call of a renewed international commitment to the revival of democracy.
Back in December of last year, I wrote in this space, "Joe Biden has that rarest of opportunities that history provides: the chance to be a transformative president."
Biden's trip to Europe recognizes and builds upon that opportunity. However, perhaps just as motivating is the understood but unspoken cost of failure at a time when the question about what global forces will shape the future is up for grabs.
Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United States' most influential think tanks on global affairs. He worked at The Wall Street Journal for more than 25 years as a foreign correspondent, assistant managing editor and as the longest-serving editor of the paper's European edition. His latest book – "Berlin 1961: Kennedy, Khrushchev, and the Most Dangerous Place on Earth" – was a New York Times best-seller and has been published in more than a dozen languages. Follow him on Twitter @FredKempe and subscribe here to Inflection Points, his look each Saturday at the past week's top stories and trends.