The Huawei saga is really a fight between US and China over who will dominate the global economy

The battle for supremacy is on a knife edge

Despite the many challenges, the US does have the ability to reinvent its economy, as it has shown again and again (AFP/Getty)

The Huawei saga is getting rough, and it is going to get much rougher. This is not just about the commercial future of the world’s largest telecom equipment manufacturer and second-largest mobile phone maker, though that is a huge story indeed. Nor it is just about the rumbling trade war between the US and China, though that too is huge. It is about which country dominates global technology over the next 30 years, the US or China – and at one remove, which will dominate the world economy.

Huawei faces a two-pronged attack. Put at its simplest, America’s trading partners are under pressure not to buy its commercial equipment on security grounds, while consumers outside China itself won’t choose Huawei phones if they can’t get speedy access to Android upgrades. The way these tensions may play out are discussed by my colleague James Moore here.

Huawei is interesting because it is becoming a test case. Can pressure from the US shut it out of global equipment markets? The answer to that, for most markets at least, is probably yes. Most developed countries forced to pick between the US and China will plump for the US. For emerging markets, the balance of advantage is a bit different – for Chinese investment is huge and is transforming (on China’s terms) African infrastructure. But you don’t want to pick a fight with the US.