Divide between U.S. tech firms and China -- A Great Wall?

The honeymoon between China and the U.S. tech industry is over, and the warm feelings may be gone for a while. APARC's Lawrence J. Lau comments.

History shows that these sorts of trade problems can last a long time. In the '80s, Japanese and U.S. semiconductor manufacturers sparred constantly. A truce only began in the '90s when Japan was already mired in an economic slide. Moreover, such trade quarrels can lead to global incompatibilities that linger for years and hurt both importers and exporters. "I believe there are genuine security concerns on China's part, although the domestic industry is also likely to benefit," said Lawrence Lau, the Kwoh-Ting Li professor of economic development at Stanford University. "This happens quite often. Our cell phones do not work in Japan, so the Japanese manufacturers and distributors have a lock in their home market. However, that did not exactly help Japan. By setting a different standard, Japan has actually limited the growth of its own cell phone companies."