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There is a school of thought which maintains that the main target of USA is Huawei. It is expected to take the lead in 5G technology. If that happens, it will be the first time somebody not from West will take the lead in Telecom and IT industry. This will have a far - reaching effect for the future. 27 China s Holdings of US Public and Private Securities China s holdings of the US public and private securities constitute the largest category of Chinese investment in the US. These securities include US 26. Geoffrey Garrett, Why the US - China Trade War is Really About the Future of Innovation ”, The Wharton, April 9, 2018 available at: article/u - s - china - trade - war - really - future - innovation/ 27.Gordon Watts, “5 G becomes the Latest Battlefield in US - China Tech War ”, available at: - becomes - the - latest - battlefield - in - us - china - tech - war/
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US - CHINA Trade War: Analyses of Deeper Nuances and Wider Implications 26 Treasury securities, US Government agency securities, corporate securities and equities (such as stocks). China s investment in public and private US securities totalled $1.63 trillion as of June 2016, making it the second largest holder after Japan. The US Treasury securities, which help the federal government finance its budget deficits, are the largest category of the US securities held by China. China s holdings of the US Treasury securities rose to nearly $1.19 trillion in 2017, making China the largest foreign holder of US Treasury securities. In 2017, China s holdings of the US Treasury securities as a share of total foreign holdings rose to 18.8 percent. 28 Some analysts and members of the US Congress have raised concerns that China s large holdings of the US debt securities could give it leverage over the US foreign policy, including trade policy. They argue that China might attempt to sell or threaten to sell a large share of its US debt securities over a policy dispute, which could damage the US economy. Others counter that China s holdings of the US debt give it very little practical leverage over the US. They argue that, given China s economic dependency on a stable and growing US economy, and its substantial holdings of the US securities, any attempt to try to sell a large share of those holdings would likely damage both the US and Chinese economies. This could also cause the US dollar to sharply depreciate against global currencies, which could reduce the value of China s remaining holdings of US dollar assets. The US Secretary of Defence issued a report in July 2012, stating that attempting to use US Treasury securities as a coercive tool would have limited effect and likely would do more harm to China than to the US. As the threat is not credible and the effect would be limited even if carried out, it does not offer China deterrence options, whether in the diplomatic, military, or economic realms, and this would remain true both in peacetime and in scenarios of crisis or war. 28. Wayne M. Morrison,
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