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USA vs Huawei, which could be the consequences?

May was a difficult month for the Chinese giant Huawei. The administration of Donald Trump placed the company on the blacklist to do business, forbidding any kind of commercial relationship with the United States without first having a special permit from the Department of Commerce. Derived from alleged “backdoors” in their devices that allowed the Chinese regime to spy on US citizens.

Huawei sanctions are not new, they began in January when the government of President Trump filed a lawsuit against the Chinese company, stating that it had conspired to steal intellectual property to the operator T-Mobile. Derived from these recent actions, Google made the decision to break relations with Huawei so it will immediately lose access to updates to the Android operating system, including access to the Play Store (its app store), Gmail and other functions, in the next Huawei smartphones.

This prohibition delays and jeopardizes the supply chain for the implementation of 5G services in the world, but future sales of the company are the most dangerous. Huawei, nevertheless, communicated that they have a “plan B” which consists of that they have increased for months the inventories of the necessary components to continue arming their equipment and for the development of their own operating system. Kirin, as it is known until that new operating system, will be released later this year or early 2020.

However, the company’s plan B does not seem to calm telephony service providers. Vodafone and EE, two of the largest operators in the United Kingdom, have decided to temporarily suspend orders for mobile phones with 5G technology to the Chinese manufacturer. For its part, Softbank and KDDI, the largest operators in Japan, have opted for the same maneuver. To make matters worse, the SD Association expelled Huawei, so the Chinese company will no longer have access to the use of microSD cards, technology that make use of most of their smartphones.

Huawei, inside China, enjoys great popularity since it is living a different reality from the West. For example, searches are done through Baidu, the Youtube alternative is called Toktok, and the most popular chat application is Wechat. Undoubtedly, Huawei is in a critical position where it seems that China is being confined, the future of this great Chinese company will depend on its trade negotiations with the rest of the world, but – mainly – with the United States. The world must consider that the supply chains nowadays are global and the fall of one of the most important companies in technological innovation can affect other international companies.

Or, in the effort to try to block China’s technological advance through this company, it could have the opposite effect and cause it to accelerate the development of technologies that compete with those Americans that currently dominate the market. Thus, we could see in the short-term progress in the development of Huawei devices that allow them not only to be self-sufficient, but to be a real alternative to Western technology.

LONE WOLVES, NEW DILEMMA FOR INTELLIGENCE AGENCIES

On April 15, 2013, two terrorists of Chechen origin – the Tsarnaev brothers – detonated two bombs in a building on the side of the Boston Marathon finish line, leaving three people dead and 282 injured, many seriously. On April 30 of the following year, the United States Senate called a hearing to evaluate the work of the intelligence agencies, the way in which they collaborate and determine if there was any responsible in not having avoided the attack. The Senate Commission in charge of the hearing determined that there was little that the intelligence agencies could do to avoid the attack, even with the power to extract and massively analyze data as stipulated in the PATRIOT Act .

The biggest criticism of the agencies, particularly the FBI, was that they did not take the opportunity to arrest one of the Tsarnaev brothers in 2012 when the Russian government alerted them to the possibility that they were planning a terrorist attack. Once this opportunity was over, according to the Senate Committee, there was little they could do to stop it.

After the traumatic September 11 attacks and the actions taken by the security agencies to prevent it from happening again, it is important to note that the Senate was quite flexible in its determination that the Boston attacks can not be attributed to failures of the intelligence agencies, why?

The mechanisms for combating terrorism in the 21st century are designed to counteract events such as the attacks of September 11. Current techniques in the prevention of terrorism depend on techniques that place attackers inside a terrorist network. That is, to identify their ideological motivations and thus anticipate attacks and even eradicate key leaders. However, the Boston terrorists do not correspond to the ideology of a particular terrorist cell. After the Boston attacks, the FBI conducted an investigation to identify the terrorist group to which the Tsarnaev brothers belonged without finding any important link.

These types of terrorists are called lone wolves. They are individuals who self-radicalize without being a militant of a terrorist structure. In fact, most lone wolves are self-taught in the preparation of terrorist attacks thanks to Internet access.

The millions of dollars spent on counterterrorism were insufficient to prevent two individuals from detonating a pair of bombs made with household items. Adam Schiff – congressman and member of the Intelligence Committee – argued that, in order for the FBI to become aware of the radicalization of the Tsarnaev brothers , he would have had to resort to surveillance techniques that the Justice Department does not authorize him. This presents a great dilemma for the democratic values ​​of the United States since, to capture lone wolves, its government must resort to measures that exceed its constitutional limits for the protection of individual liberties.

For example, PRISM – an authorized surveillance program for the mass collection of personal data – can inform intelligence agencies if a neighborhood is prone to radicalization. However, despite the enormous amount of data, inferences about the propensity to radicalize a community are still the result of a computational system and not an analysis of an individual’s personality traits or history. If the premise that any member of one of these neighborhoods is a potential terrorist is accepted, preventative measures can be justified for the detention of individuals in these neighborhoods to protect national security. That is, with methods for the identification and capture of terrorists in force,only the actions of individuals can be anticipated if the State is imposed on the civil liberties of the individual, such as the right to privacy.

The limit is clear when it comes to a terrorist network made up of external individuals. However, what is the limit if the threat comes from within a democratic country? Is there a limit if any citizen is a potential terrorist? And, given the experience in Boston, is it valid to expand the discretion of intelligence agencies? Is it legal to register and monitor citizens in communities prone to radicalization? Is it justified to overreach the work of intelligence abroad in order not to violate individual liberties in their own country?

Thanks to the investigative tools available to the FBI, they were able to identify one of the Tsarnaev brothers as a suspect in the commission of crimes, but not to locate him as a potential terrorist. Russia, on the other hand, identified its process of radicalization thanks to the fact that it followed up its trip through Chechnya (a region converted into a hotbed of extremist Islamism in recent years).

There are experiences worldwide that are worth mentioning since they have shown their effectiveness in deradicalization processes without generating threats to the human rights of people. Since lone wolves tend to radicalize in their own country, there are programs that place radical behavior as a manifestation of criminal activity and not as a characteristic of a social group. This allows terrorism to be prevented without the need to make a sharp choice between safeguarding individual liberties or national security.

There is evidence that an adequate coordination between civil society and government makes it possible to prevent terrorism by identifying individuals who have initiated a process of radicalization and instructing them in ways to express their religious motivations within a legal and democratic framework. In turn, civil society not only contributes to combating radicalization, but also to providing valuable information to the government on cases that require urgent attention.

Such is the case of Aarhus, a city in Denmark from which 30 inhabitants left in 2013 to join the Islamic State and which for 2015 did not report any cases. Its deradicalization program includes initiatives such as workshops on social reintegration, psychological care, advice to parents and forums for dialogue with Muslim communities; all in which religious, civil and governmental organizations participate jointly. It is an example of a successful program to combat radicalization without involving a quasi-totalitarian supervision by intelligence and police agencies. At the same time, it implies the participation of civil society with government for the identification of patterns of violence which, in turn, strengthens the democratic value of civic participation.

Either way, it is important that governments and businesses in the 21st century consider the attack in Boston as an important example of how the political motivations of a small group – even an individual – can disconcert and perhaps paralyze large security apparatuses of the States.

 

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Photo by Michael LaRosa on Unsplash

NEW SILK ROUTE, WILL CHINA DOMINATE THE WORLD?

In 2013, the President of China, Xi Jinping, presented a project that includes the development of infrastructure to facilitate the exchange of goods through land and sea corridors around the world. Currently, 80 countries participate in this project, whose official name is ” Belt and Row Initiative ” , referring to the ancient silk route used in the times of the Han Dynasty, in the first century BC. This initiative consists of the financing by the Chinese government of infrastructure around the world in exchange for political, commercial and strategic benefits.

China is the second economic power of the planet and, according to experts, it has the potential to become the most important commercial power in the world. China went from being one of the most impoverished countries in the world, after the policies of Mao Zedong “One Step Forward” and the “Great Cultural Revolution”, to be the main creditor of developing countries for the construction of infrastructure.

Among the objectives of the New Silk Road are: to facilitate regional development by eliminating barriers to trade, increase communications with neighboring countries and increase the flow of raw materials to China. To achieve these ends, we seek to create alternative maritime and land routes to those currently used, such as the Strait of Malacca and the Suez Canal, where 20% of world trade passes through.

It is estimated that this initiative could generate a market ten times greater than the United States. To fulfill this colossal goal, resources are available from the New Development Bank (composed of the BRICS countries: Brazil, Russia, India, China and South Africa), the Silk Road Fund and the Asian Investment and Infrastructure Bank (origin Chinese). Likewise, if the stated objectives are met, this initiative would add 56,000 MDD to Chinese exports and 61,000 MDD to imports, which represent 36% of world GDP, according to Euler Hermes consultancy reports . However, the International Monetary Fund warned that “resurrecting the silk route … can also lead to a problematic increase in debt, creating challenges for the balance of payments.”

One of the great advantages of these Chinese loans to finance infrastructure is that they are bilateral in nature. This allows loans, despite being more expensive, to be more advantageous and flexible compared to loans provided by multilateral institutions such as the World Bank. This makes them extremely attractive to countries that have restrictions in accessing international financial markets such as, for example, Venezuela. It is worth mentioning that, although these Chinese credits are given with fewer restrictions than others, the conditions always benefit the Chinese economy, for example, in the case of Ecuador it was stipulated that only Chinese companies would be used to develop the projects with this country.

According to Stephan Monier, Chief Investment Officer of Lombard Odier , China has found a way to acquire a central role at a global level while the United States is losing it due to the adoption of protectionist policies. Thus, this initiative has accentuated the economic rivalry between China and the United States, generating geopolitical frictions due to the capacity of influence that the Chinese government has gained in the international concert.

This new area of ​​influence is the result of the fact that, with the New Silk Road, China is reinforcing and increasing its presence in Asia and Europe, that is, places where the United States traditionally exerted influence. Likewise, China has considerably increased its presence in African countries, where it finances the construction of entire cities in, for example, Kenya, Guinea, and Ethiopia. Thus, this program has strategic implications for world politics since it could generate the legitimacy of Chinese actions, especially in the South China Sea, where there are tensions with its neighbors for their sovereignty, on the part of the international community.

There are still many elements to analyze in order to measure the degree of success of this project. However, the first steps have been taken, the world has to be prepared to take advantage of the advantages that this brings and, at the same time, protect against the threats that come with a project of this magnitude.

 

Are you interested in knowing what opportunities and risks your company has as a result of Chinese economic policies? Write to info@riesgospoliticos.com.mx to provide you with the advice you need.

 

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WHO WILL LEAD THE DEMOCRACY CANDIDACY TO THE PRESIDENCY OF EE. UU IN 2020?

The next presidential elections in the United States will be in November of 2020. Undoubtedly, the possible re-election of Donald Trump along with the debate generated by his protectionist, anti-immigration policiesand isolationists, will make these elections of particular interest at an international level. We will see if Trump’s speech has taken root in the US electorate, beyond the republican base itself, or if his election responded to a specific historical moment as a consequence of the financial crisis of the past decade and that contributed to generating a anti-globalization wave. Thus, from this scenario, the Democratic Party has begun to move its pieces and there are already those who have raised their hands to champion the Democrats in the race for the presidency of our northern neighbor.

Although not yet defined, Donald Trump is expected to seek reelection and be the candidate of the Republican Party in 2020. For this reason, issues such as the construction of the wall on the border with Mexico, the “Deferred Action Program for Arrivals” in Childhood “known as DACA, the separation of migrant families on the border, the health reform called Obamacare , the adoption of international agreements against climate change and those in trade, the tax reform and the symptoms of slowdown in the economy American, will be all issues that will be discussed throughout the Democratic primaries and-after-in the campaigns.

Having said that, it is worth making a list of the Democrats who have already expressed their intention to seek the candidacy of their party for the presidency; which, until now, is made up of the following politicians:

  • Kamala Harris , current senator for California, of Indian mother and Jamaican father, roots that make her particularly close to the pro-migratory cause. He served as California Attorney General from 2011 to 2017. He has been one of the most critical voices of the Trump administration since Congress.
  • Elizabeth Warren , senator for Massachusetts since 2013, has had a meteoric career in the political arena. She was a law professor at Harvard University for more than 20 years. He has been critical of the inequalities of the American economic system and the power that Wall Street holds.
  • Senator from New Jersey, Cory Booker , who served as mayor of Newark between 2006 and 2013. He is one of the African-American Democrats best positioned for the race.
  • Sherrod Brown , senator from Ohio, is a lawyer with extensive experience in both federal and state Congress. He is one of the few liberal politicians with a successful career in the Midwest of the United States. UU., Traditionally conservative, so it has a good popularity among the electorate; however, he has no experience in fundraising.
  • Kirsten Gillibrand , is a senator from New York since 2009 when Hillary Clinton vacated that seat. In 2012 he won his re-election with 72% of the votes. Liberal, particularly in immigration issues and arms sales. He has worked against sexual harassment and has been the head of movements such as # MeToo and the march of women.
  • Julián Castro , Mayor of San Antonio, Texas, from 2009 to 2014 and Secretary of Urban Development and Housing from 2014 to 2017, during the Obama administration. He is the best Latino in the polls. During the campaigns of 2016, it was speculated that Hillary Clinton could have chosen him as his candidate for vice president.
  • Pete Buttigieg , 37, mayor of South Bend, Indiana, is a veteran of the Afghanistan war. He would become the first openly gay presidential candidate.
  • John Delaney is a politician and millionaire who in 2018 decided not to seek his reelection as representative of the 6th district of Maryland to the US Congress. He was the first Democrat to announce his intentions for contending for the presidency in a formal manner.
  • Tulsi Gabbard is a representative for the state of Hawaii. He participated in the wars in Iraq and Kuwait. He opposes forcibly removing the president of Syria, Bashar Al Assad, and has been critical of the foreign policy of his country, particularly the wars in Iraq and Afghanistan. Likewise, he was against the Trans-Pacific Economic Cooperation Agreement (TPP ).
  • Andrew Yang , 44, is an entrepreneur and founder of Venture for America , an organization focused on promoting the work of entrepreneurs. He worked with Barack Obama as his ambassador for global entrepreneurship.
  • Amy Klobuchar , was the first woman elected to the Senate by the state of Minnesota in 2006, having been re-elected in 2012 and 2018. Her electoral platform includes universal health care, constitutional amendments to annul decisions of the Supreme Court of the United States, adherence to pacts international organizations to combat climate change, promote legislation on arms control and reform the criminal justice system.

However, it is also expected that others will make public their intentions in the coming months, among them are:

  • Joe Biden , who had an outstanding career as a Delaware senator from 1973 to 2009, and then as vice president from 2009 to 2017.
  • Bernie Sanders , a former presidential candidate in 2016, is currently a senator from the state of Vermont.
  • Michael Bloomberg who is a media entrepreneur and was mayor of New York between 2002 and 2013.

 

What we can be sure of is that the Democratic Party will make a very important turn to the left with whoever is their candidate for the presidency in 2020.

 

Are you interested in following up on the development of the US elections? Approach Political Risks to give you the advice that your organization needs, write us to info@riesgospolitcos.com.mx

 

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