Technology is key to winning

Park Je-hoon

The author is a professor at Incheon National University and chairman of the Asia Economic Community Foundation.

Following Russia’s threat to use nuclear weapons in the Ukraine war, North Korea in September legalized a preemptive use of nukes to strike adversaries. Existential global threats have been looming over the human civilization. Fundamentally, how to define the war in Ukraine is as important as who will be the winner.

Russia claims that the war is to liberate pro-Russian residents using the Russian language in Ukraine. But the West regards it aggression towards the last colony of the Russian empire. Gerard Roland, a professor of economics at UC Berkeley, has explained the geopolitical complexities in the context of “empires, nation states, and democracies.”

According to Roland, Russia and China are surviving empires of the 21st century with expansionism as a dominant strategy. He believes such empires will recede in the mid-to-long terms. Instead, an alliance of nation-states of democracies will challenge such expansionist empires.

Under the context, China’s expansionism is different from that of others as it is led by a drive to enforce Han-centric ethnicity, rather than by religious and ideological purpose. If China justifies unification with Taiwan by force for ethnical homogeneity, it could be as dangerous as the past Nazi empire.

The developments in the Ukraine war could have enormous ramifications on the strategic contest between the United States and China. But who will win the fourth industrial revolution of technology can determine the winner of the struggle between the two giants.

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Just as the first industrial revolution spanning from the 18th to mid-19th century did, the fourth industrial revolution will leave a select winners and mass losers to deepen inequalities and polarization. The globalization from the 20th century lowered the income of low-skilled workers. By contrast, online platform enterprises and AI in the 21st century have undermined the income of the middle-level to highly-educated class to broaden and fasten the scope of inequality. The rise of populism in the U.S. stems from the worsening polarization.

Chinese President Xi Jinping extending his rule into a third term has been championing common wealth under the pretext of easing inequalities and polarization to help weaken the capitalist elites formed through the opening and reform of Deng Xiaoping. Through the lengthy reign, Beijing has showed that it puts bigger priority on strengthening the power of the Communist Party and single leadership than on winning the system competition with the U.S.

Who evens out the disparities from the fourth industrial revolution and sustains growth will determine the result of the hegemonic contest between the two superpowers. China may ease inequalities to some extent through state-controlled economy, but it won’t likely grow as fast as before. China has built up cooperative ties with Russia since the Ukraine war, but if it relies on cheap gas and oil from Russia, the country could fall behind the U.S. in energy innovation, a key to the fourth industrial revolution.

Since the war in Ukraine, the global value chain has been realigned based on the value systems of democracy and autocracy. The U.S. and Europe will form a democracy bloc while China and Russia the authoritarian bloc and India, South America and Africa the third bloc. At first glance, the classification appears to have been defined by universal values. But the division is actually being established based on practical economic gains for technology and supply chains. The third bloc will choose one side over the other based on which side will benefit it.

Where does South Korea stand? The country does not have a choice with the U.S. due to political and security factors. With North Korea decisively turning to the China-Russia front since the Ukraine war, Seoul may not be able to maintain the tightrope between Beijing and Washington. On the technology and economy level, South Korea must play a pivotal role in the democracy bloc in the fourth industrial age.

Korea must be ahead in energy revolution as well as chips and batteries. It must concentrate capabilities on the hydrogen economy ecosystem. According to Julio Friedmann, a senior research scholar at the Center on Global Energy Policy at Columbia University, the hydrogen economy can cheapen energy costs to help ease the widening disparities among nations from the fourth industrial revolution.

But just being ahead in technology does not guarantee winning in the competition. The state governance backing technology advances is important here. Establishing a political and social governance structure to promote technologies in an environmentally-friendly manner while lessening inequalities is an urgent task for South Korea.

Translation by the Korea JoongAng Daily staff.