Trade, Technology and Security: Exploring the Linkages.

As tensions between China and the US have grown since 2016, so too have China’s economic and political difficulties with a number of other countries, particularly those in the Five Eyes intelligence sharing relationship. Relations between the European Union and China have also experienced their fair share of troubles, with different Member States split on whether and to what degree they wish to confront China.

One area where tension are playing most acutely is in the area of techno-nationalism, with more countries enacting broad-based trade and investment restrictions against Chinese technology companies and justifying these actions by invoking national security.

This working paper explores the linkages between the areas of trade, technology and security that underlie this increased securitization of trade. In doing so, it addresses these issues by focusing on three core research questions, namely:

1. What activities do technology firms pursue on foreign markets and how do restrictions imposed by governments for national security reasons circumscribe either these firms’ market access or freedom of action in a way that prejudices their relative competitive position on these markets?

2. What obligations are incumbent upon governments by virtue of international trade and investment treaty commitments to permit the entry and operation on their domestic markets of foreign technology firms and to what extent do national security exceptions as formulated in these same treaties allow governments to set aside these obligations?

3. What are some solutions to balancing the need for an open and non-discriminatory trading system with the imperative of upholding national security where these policy priorities collide in the area of trade and technology, and what role do different actors (States, firms, others) have to play?

READ WORKING PAPER

By Simon Lacey, Senior Lecturer, Institute for International Trade
The University Of Adelaide