The Great Uncoupling,
by Nigel Inkster
(Hurst, £25)

IN THE Great Decoupling, former MI6 director of operations and intelligence Nigel Inkster explores the growing tensions between the US and China and assesses the prospects for an economic and technological “decoupling” between the two.

Inkster documents China’s emergence as a technology superpower over the past four decades, starting with the Chinese Communist Party’s realisation in the early 1980s that ICT was likely to constitute a “strategic high ground” for the foreseeable future.

To observers in the West at the time, the idea of China as a peer competitor in science and technology must have seemed absurd, given that the “comparative advantage” it offered to global value chains was its abundance of cheap and competent labour, put to work primarily in light manufacturing.

As the economist Justin Yifu Lin has written, “technological innovation is not a free lunch, it needs capital.”

The government devised a long-term strategy to transform itself into a technology powerhouse, leverage China’s huge labour force to develop of the generation foreign exchange, import technology and learn technique, while simultaneously improving the quality of life for hundreds of millions of people.

The success of that strategy is becoming increasingly apparent. China has already moved into the lead in several important areas of technology, most notably 5G infrastructure, and is catching up fast in others.

Companies such as Huawei, Alibaba, Lenovo and ByteDance are encroaching on a space that the US has become accustomed to dominating.

Inkster believes that, with China’s technological rise, some level of decoupling is inevitable. The US, unable to accept China’s presence in a level playing field, will seek to reduce its engagement and to limit Chinese development.

It will shift a significant proportion of its capital investment,  clamp down on Chinese investment in the US, seek to deny China access to knowledge and resources and encourage its allies to follow suit. Thus Inkster believes that the economic cold war on China will continue and will deepen.

The author points out that the road of decoupling is dangerous and expensive, citing Deutsche Bank technology strategist Apjit Walia’s calculation that a total technology decoupling from China could cost in the region of $3.5 trillion.

Bifurcation of technology standards will introduce unnecessary and expensive interoperability issues that will ultimately lead to increased costs, reduced profitability and reduced innovation.

It will become a source of global contention as countries around the world are forced to choose between the two major technology spheres.

And the cons may well outweigh the pros for US capitalism: “The US might end up isolating itself, damaging its prospects for future growth, reducing its relative power and diminishing rather than enhancing its security,” according to Inkster.

In spite of recognising these very real dangers of decoupling, Inkster’s narrative tends to legitimise the project, repeating every cold war trope about China being a “techno-security state” and categorising the Belt and Road Initiative as a means to “reshape the global order in ways favouring Chinese interests, potentially resulting in a world subject to Chinese hegemony.”

Throughout,  Inkster highlights problems that affect many nations  but which Western capitalist countries can be trusted to adequately resolve and China cannot.

For example, the author recognises the potential benefits of smart-city technologies — AI-enabled environmental protection and traffic management — but warns that “technologies designed to optimise efficient urban living can also be optimised for social control,” a  concern is hardly unique to China.

His pro-Western bias — and his willingness to parrot discredited anti-China sources such as Adrian Zenz — prevent the author from building a rigorous critique of decoupling and urging Western politicians towards an alternative path.

This constitutes a significant weakness in what is otherwise a useful and detailed study of the ongoing technological competition between China and the US.