China did not take any immediate measures in response to the recent US decisions regarding the application of TikTok, but Beijing could target a number of US companies as a retaliatory step.
In her report, which was published by the American Foreign Policy magazine, writer Nina Palmer said that US President Donald Trump's announcement a few days ago of his intention to ban the Chinese application of TikTok in the United States has caused a great shock in the technology sector, and may affect American companies operating in China.
Microsoft has begun negotiations with the company, "ByteDance", which owns the application, in order to acquire it, and the Foreign Investment Committee in the United States has given 45 days to complete the deal or ban the application.
Although ByteDance is not owned by the Chinese government, it is a private company that managed to invade the local and global markets through the application of TikTok, whose market value is currently estimated at $ 50 billion (the value decreased by half compared to last May), the response came Official steps on the US authorities in Beijing.
The Chinese Ministry of Foreign Affairs announced on two occasions during the past days, its objection to the US government's move against the application of TikTok, noting that the pressure exerted by the United States on a Chinese company to sell part of its operations violates the principles of the World Trade Organization of openness, transparency and non-discrimination.
Delayed reaction
However, the author believes that China will not currently take any immediate retaliatory measures against American companies in response to President Trump's intention to ban TikTok or impose an acquisition, for several reasons.
The first of these reasons is that the Chinese authorities basically impose significant restrictions on foreign companies and investments, and most American technology companies have already been banned from operating in China, and there is no American application that the Chinese use extensively, and Beijing can ban it as a retaliatory step.
The Chinese government is currently working to encourage foreign investment to reduce the devastating effects of the spread of the new Corona virus, and to maintain previous growth levels and make its economy more advanced and diversified.
Beijing also seeks to maintain good relations with the business elites in the United States, because common interests have made businessmen traditionally take a less hostile approach to China, unlike US policymakers.
The author said that what strengthens the hypothesis that China will not resort to any hasty retaliation against the US steps is the way it dealt with its similar crisis with India during the last period.
The Indian government banned the use of TikTok and 58 other Chinese applications last June, and China has expressed its rejection of this measure, but it has not taken any punitive steps.
A spokesman for the Chinese Ministry of Commerce announced on July 2 that Beijing has no intention of taking any measures of embargo or discrimination against goods and services coming from India.
According to the author, this may indicate that the Chinese government does not intend to take any retaliatory measures regarding the Tik Tok ban in the United States, or that its position on India was caused by a desire to reduce tension after border skirmishes between the two countries in the Galuan Valley region.
Potential targets
The author adds that if the Chinese government chooses to retaliate against the measures taken by the US government regarding the application of TikTok, it has many potential targets.
Among these goals is Cisco Systems, which does not have good relations with the Chinese, due to its years-long conflict with Huawei over intellectual property rights.
Other US companies that China may target include Amazon Web Services, which owns a cloud services project in China, and Apple and Microsoft.
According to the author, the Chinese government, which seeks to achieve a balance between its commercial interests and its initial commitment not to be silent about US measures, may resort to retaliatory steps of a special kind, such as continuing to adopt a policy of restrictions on US companies with the aim of preventing them from expanding their activities in the Chinese market.
The author emphasized that if the United States government forces TikTok to sell its share in the US market, instead of banning it, this will increase the likelihood that the Chinese government will target US companies, and this may amount to forcing some companies operating in China to sell their assets.