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Broadcom + Qualcomm deal highlights a new age of tech protectionism and national security fears

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On Monday, Trump ordered Singapore-based chipmaker Broadcom to drop its $117 billion bid for US rival Qualcomm, citing security concerns over the deal.

When he killed Broadcom’s pursuit of Qualcomm, President Trump put his administration in uncharted territory. The White House has made no secret of its concerns about Beijing and seems to have been motivated by the prospect of Qualcomm losing its lead in 5G.

The move highlights growing sensitivity in the US that acquisitions by foreign companies could jeopardize the country’s leadership in critical technologies—in this case, next-generation 5G wireless networks. The Committee on Foreign Investment in the United States (CFIUS), which vets foreign takeovers of US companies that are considered strategic, probably recommended that the deal be blocked.

Some now worry that this could be another front in a potential global trade war. 

Here’s Jason Furman, a senior economic adviser in the Obama White House, talking to the New York Times: “If every country in the world conducted policy like that, it would make cross-border investment difficult to the detriment of American and foreign companies,” Furman said. “Foreign direct investment is an important part of the strength of the US economy.”

In the short-term, America's voters will be protectionist, anti-trade, and no major presidential candidate in 2020 will be pro-WTO. 

Mark this post. 

You can't put all this anti-globalization back in the bottle.

Marc A. Ross is the founder of Brigadoon and specializes in developing winning communications, content, connections, and commerce for entrepreneurs and thought leaders.