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The new normal in US-China relations: Hardening competition and deep interdependence

You know, China will come to the table with its concerns about what the United States is doing and the United States has an obligation on behalf of its citizens to come to the table with our concerns about what China has been doing for quite a long time, and I certainly came to the table prepared to do that when we were in Bangkok. Frankly, if you ask people about the U.S. economy one year ago versus where they are today people umarkets review would have a different answer. So what we’re focused on fundamentally is thinking about what we can do to invest in the sources of our own strength here in the United States, and I talked about that some in my speech. And then we, obviously, also had the opportunity to talk about current events—current events in the Red Sea, current events on the Korean Peninsula, concerns that we have about instability in both places.

  1. Biden prioritized issues like COVID-19 virus, climate change, and inequality and racism.
  2. The PRC voted in favor of UNSCR 1373, publicly supported the coalition campaign in Afghanistan,[111] and contributed $150 million of bilateral assistance to Afghan reconstruction following the defeat of the Taliban.
  3. On Friday, China’s top diplomat, Yang Jiechi, held a phone call with US Secretary of State Antony Blinken.
  4. Political conflict can easily make people who have never met feel hostile toward each other.
  5. And then, finally, the relationship extends to economic coercion, the intersection of technology and national security, innovation, economic investment and vitality, all areas where the three countries have a huge amount of complementary capacity to support and lift one another up.
  6. A US bipartisan congressional delegation led by Senate Majority Leader Chuck Schumer held a rare meeting with President Xi Jinping on Monday afternoon.

In late May 2022, the State Department restored a line on its fact sheet on US-Taiwan relations which it removed earlier in the month and stated it did not support Taiwanese independence. Shortly after being elected president in 1980, Ronald Reagan made a speech criticizing the PRC and welcoming restoration of ties with Taiwan. These remarks aroused initial concern in Beijing, but Reagan’s advisers quickly apologized for his comments, and the president-elect soon retracted them. Reagan’s first two years in office saw some deterioration in US-China relations due to the president’s vociferous anti-communism, as well as the inability of the two nations to come to a common understanding over the Korean conflict, the Israel–Palestine conflict, or the Falklands War. In 1982, Chinese leader Deng Xiaoping, in a reiteration of Mao Zedong’s “Three Worlds” theory, criticized both the US and Soviet Union for imperialism.

– US calls on China to halt South China Sea build-up

If there is one thing that Republicans, Democrats and the U.S. establishment agree on, it is that China is a strategic competitor of the U.S. and must be confronted. However, 2021 has seen economic policy move in reverse, with growing state control over the private sector and economy more generally, and a shift to a more socialist direction, with its new “Shared Prosperity” policy. The Phase One Agreement also requires substantial additional purchases of U.S. goods and services in the coming years.

Formal Ties and One-China Policy

It would be nice to look forward to a return to relative stability to US/China relations in 2021. As recent events have highlighted, however, anything can happen in this highly fractious and fragile relationship. But the fact that leaders are talking with each other, in a civil and diplomatic manner, gives hope that events will not spin out of control. Further, President Biden has invited Taiwan to his “Summit for Democracy”, a virtual meeting being held on December 9-10 for leaders from government, civil society, and the private sector from over 100 countries, but to which neither China nor Russia is invited.

China Is Quietly Expanding Its Land Grabs in the Himalayas

The meeting came two days after Kissinger met with the Chinese Defense Minister Li Shangfu, in which they discussed the current state of US-China relations. The meetings follow a string of encounters between Chinese and US officials in recent months, and are a further sign that the two countries are sincerely abiding by the consensus reached between President Xi and President Biden to improve communication in their meeting in Bali in November 2022. In a statement responding to the news, China’s Ministry of Commerce called the move a “typical act of economic coercion and unilateral bullying” and called on the US to “immediately correct its wrong practices and stop its unreasonable suppression of Chinese companies”. According to the statement, “These entities supplied Russian consignees connected to the Russian defense sector with US-origin integrated circuits”. The statement says that Russia relies upon these components for precision guidance systems in the missiles and drones used in the Russia-Ukraine war.

“US diplomatic or official representation would treat these games as business as usual in the face of the PRC’s [People’s Republic of China’s] egregious human rights abuses and atrocities in Xinjiang, and we simply can’t do that,” White House press secretary Jen Psaki said. Beijing has reacted strongly, with its foreign affairs spokesman threatening “resolute countermeasures”. And the president has recently signed an executive order that gives him additional tools and authorities to deal with this challenge. It’s not directed at the PRC; it is general to countries that are supporting Russia’s defense industrial base, but it gives us tools it this regard. NATO, which has focused on deterring Russian aggression and terrorism in recent years, releases a communiqué expanding the alliance’s focus to include threats from China, such as its nuclear weapons development and military modernization.

The biggest factor working in the United States’ favor is the strength of the multilateral institutions – such as the United Nations, World Bank, and World Trade Organization – that the U.S. itself helped to create. These organizations enhance collaboration, provide collective goods, maintain order, and strengthen the international rule of law. The most important https://traderoom.info/ thing that the U.S. can do in its relationship with China is to both strengthen these institutions and make sure China is included. Exaggerating China’s strengths leads to panicked reactions, such as mutually costly efforts to kneecap China’s economic development. The opposite assessment can lead either to complacency or to dangerously assertive bullying.

Analyzing the shape of US-Chinese relations, it is worth pointing out that for Biden it was not a partnership conversation, but rather negotiations with the main rival in the race of powers. “So we believe that it is important for the United States to change its own image and to stop advancing its own democracy in the rest of the world.” – Yang Jiechi spoke during the talks. The main expectations of the Chinese were to lift the restrictions imposed by the Trump administration. In an atmosphere of mutual tensions, the representatives of the two world powers met in Alaska in March.

China Increases Military Spending

The summary of China’s policy is also an assessment of the first year of the new administration at the White House. It was clear from the beginning that the key issue for the new president would be relations with the People’s Republic of China (PRC). In the perspective of bilateral relations between the United States and China, there was supposed to be a “new opening”. However, this does not follow a principle that only promotes prolongation of “pax Americana”.

In other words, we are now in a new type of Cold War, without a clear framework for managing relations and solving disputes. A second example is their agreement to resume military-to-military communications at the highest levels. Both sides should go a step further and, in conjunction with key regional states, initiate a work program to draft model regulations related to unmanned autonomous systems at sea. Convention on the Law of the Sea as they are not classified as “vessels.” Yet, lethal autonomous weapons systems (LAWS) permeate the maritime environment and when conflict arrives, they will be at the forefront of hostilities – as Kyiv’s drones have amply demonstrated in the Black Sea. Better to write the rules in peacetime, and thereby limit the scope for unintended escalatory tensions too.

The Chinese Foreign Ministry says the moves are in response to the U.S. government’s decision earlier in the year to limit the number of Chinese journalists from five state-run media outlets in the United States to 100, down from 160, and designate those outlets as foreign missions. In November 2021, Washington and Beijing agree to ease restrictions on journalists working in each other’s countries. The Trump administration imposes fresh tariffs totaling $34 billion worth of Chinese goods. More than eight hundred Chinese products in the industrial and transport sectors, as well as goods such as televisions and medical devices, will face a 25 percent import tax. The reprisal, also valued around $34 billion, targets commodities such as beef, dairy, seafood, and soybeans. President Trump and members of his administration believe that China is “ripping off” the United States, taking advantage of free trade rules to the detriment of U.S. firms operating in China.

On March, 10, the US Securities and Exchange Commission (SEC), the securities regulator, published a provisional list of issuers identified under the Holding Foreign Companies Accountable Act (HFCAA). President Xi and President Biden spoke on a conference call on Friday evening (March 18), the first direct communication between the two leaders since their virtual summit in November 2021 and the first talk since the outbreak of the Russia-Ukraine war. The Office of the United States Trade Representative (USTR) announced that it would reinstate tariff exemptions on 352 Chinese products. The tariff exclusions had on these products had expired in 2019 and 2020, and were reinstated after consultation with US agencies and the public.

As Treasury Secretary Janet L. Yellen meets with top Chinese officials in Beijing this week, her challenge will be to navigate this multifaceted relationship, which ranges from conflict to cooperation. Alibaba, Baidu, and Tencent have all opened research centers in the United States, just as Apple, Microsoft, Tesla, and other major American technology companies rely upon engineering talent in China. U.S. investment firms have been increasing their positions in China, following a global trend. BlackRock, J.P. Morgan Chase, Goldman Sachs, and Morgan Stanley have all increased their exposure in China, matching similar efforts by UBS, Nomura Holdings, Credit Suisse, and AXA. The Rhodium Group estimates that U.S. investors held $1.1 trillion in equities issued by Chinese companies, and that there was as much as $3.3 trillion in U.S.-China two-way equity and bond holdings at the end of 2020.

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