AI Stays Untouched as the US-China Trade War Rages On

US-China Trade War

Global trade experts predict that robotics, AI, and automation may emerge as winners from the China-US trade war.

As the US-China trade war continues, the barriers and tariffs on imported products threaten to slow down   business activity, dampen international trade, and create supply chain friction. This will impact countries around the globe. However, automation, robotics, and AI are notorious disruptors and will decidedly be  the final winners in this trade war.

It’s all centered around technological innovation, and China’s government is committed to dominating this global innovation surge. As per Trump, tariffs are essential to prevent further unfair transfers of American technology and intellectual property to China, protecting American jobs. To combat this threat, the Trump administration has announced tariffs aimed directly at the RAAI-specific industries that are key to China’s plan: automobiles, information technology, aerospace, and robotics.

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But, for some companies in the US and abroad that are delivering innovation and technologies in RAAI, the trade war will do nothing more than alter the size of a robot’s microchip. As per the US, China anyway isn’t a big enough player in the robotics supply chain yet.

Although Made in China 2025 is driving massive innovation in technology for the manufacturing sector , it is still not a threat from a US perspective. China is running slow in the global export market for advanced technologies. Although China has evidenced the rapid development of local firms serving the local market for advanced technologies, most of these products don’t qualify for the global export market.

This is primarily due to the inferior quality products and weak distribution channels. The tariffs won’t surely have a significant impact on the robotics industry. Around half of the goods imported from China are computers, mobile phones, integrated circuits, and consumer-focused technologies such as televisions, telecom equipment, and displays. Therefore, the tariffs imposed are not likely to make a difference to the global robotics supply chain.

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Experts confirm that today’s tariffs are more likely to aid, not hurt innovative companies in RAAI. Firstly, they are expected to fuel and accelerate the recent shift towards re-shoring. Secondly, the tariffs target components and materials that are critical to many global manufacturers, increasing the production costs. The most cost-effective and easy way to offset these higher production costs is to accelerate automation—a driving trend that would increase demand across the RAAI supply chain.

China is undoubtedly investing aggressively in AI and is even forecasted to surpass the US in 2018 in terms of actual money spent on AI technologies. Also though China’s AI technology is not mature enough to have any significant impact on global trade balances now. But, the country continues to be deeply committed to becoming a global leader in electric cars, computer chips, robotics, and a myriad of other RAAI-related products in the near future. Evolution and innovation of advanced technology are bound to happen eventually with or without international tariffs.

Trump confirmed that a trade war is “easy to win” and “good.” When it comes to RAAI, the statement may be true. Industry experts state the tariffs to be potentially good news for the industry as a whole. Every industry across the globe will benefit from the application and development of smarter technology. RAAI has been modifying how the world and business work for decades. But, when it comes to declaring the real winners in the US-China trade war – automation, robotics, and AI continue to be an exception to all the rules and predictions.

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Debjani Chaudhury works as an Associate Editor with OnDot Media. In this capacity, she contributes editorial articles for two platforms, focusing on the latest global technology and trends. Debjani is a seasoned Content Developer who comes with 3 years of experience with Fashion, IT, and International Marketing industries. She has represented India in International trade forums like Hannover Messe, Germany.