29.04.2023 Author: Vladimir Terehov

Regarding the current state of US-China relations

Regarding the current state of US-China relations

There are nearly constant developments in the relations between the two major international powers that merit at least cursory attention. The most recent occasions for addressing the transformation of these relations were visits of former and incumbent presidents of Taiwan, respectively, to the United States and China, as well as a series of visits to Beijing (which took the nature of pilgrimage) by European politicians of various levels of importance.

In all these events, the factor of US-Chinese relations was undoubtedly present, even though more subtly so. Meanwhile, in the bilateral format over the past few weeks there has also been, to reiterate, a great deal that deserves attention. And it is not just about what happened. No less noteworthy is what did not happen, although it seems to have been planned by both sides. It is even possible that the latter is more informative in terms of assessing the current state of relations between the two leading world powers.

The wish expressed in January of this year by US Secretary of the Treasury Janet Yellen and then Vice Premier Liu He to arrange a visit by the former to China “at an appropriate time” has still not been fulfilled. The evidence of the fact that the time for this, apparently, is still not too “appropriate” was the speech of the same Janet Yellen on April 20 at the School of Advanced International Studies at Johns Hopkins University.

It was this speech, as well as the subject and content of US Trade Representative Catherine Tighe’s talks in Tokyo at the same time (discussed below), that are of the greatest interest in the sum of recent events accompanying the development of US-China relations. Still, there was no shortage of political intrigue and loud public statements from those in positions of power, backed up by a game of military muscle.

 For in a significant way, both high officials of the current US administration (to which one must add a third, i.e. Secretary of Commerce Gina Raimondo) are responsible for the main content, threats and, at the same time, a source of (potential) positivity in US-China relations.  Although, of course, the banal thesis that economic and political-military aspects of real life are closely intertwined does not go anywhere.

If the problems in bilateral trade and economic relations are not resolved more or less satisfactorily, it will very likely be the turn of the “muscles.” The transfer of the use of which from the sphere of “game” into the sphere of real actions will inevitably have disastrous consequences for the whole world. Moreover, even if such an apocalyptic scenario can be avoided, humanity as a whole is threatened by a split and completely senseless exhausting struggle of divided, hostile to each other, interstate groupings.

The symbol of the so far unjustifiably exaggerated importance of “muscle” in contemporary world affairs (not least of which is shaped by propaganda fighters) is its current massive African-American possessor. He alone, apparently, weighs as much as all three of the above-mentioned “crumblies” put together, responsible, nevertheless, for the real sector of the functioning of the leading world power.   And also, in fact, for the prospect of the development of relations of said power with its main geopolitical opponent.

Meanwhile, the first signs of a possible global world division are already emerging. The author is talking about the attempts of the same US with several major allies to isolate Russia (that is, in fact, the key ally of China) from the world economic body. This was particularly evident during the series of ministerial-level events leading up to the next G7 summit in May of this year. It is clear that such attempts are doomed to failure, but they continue with almost maniacal persistence, resulting only in strengthening Russia’s ties with China, as well as with the increasingly important “Global South.”

By the way, the G7 has also indicated the struggle with China for influence over it as its most important field of activity. It is almost entirely viewed from a trade and economic perspective. That is, not at all from the military and political with their notorious “bases.”

Recall that the the term “decoupling” in relation to the US-Chinese relations first appeared in the spring of 2020 article in The Wall Street Journal, which outlined a study of the mood in the circles of American business about the prospects for presence on the Chinese market. Even then, such a prospect, at least in part, was not excluded and was associated mainly with the manifestation of the same political factor.

The role of the generalized exponent of such negative trends in US policy toward China was (and still is) that of then Secretary of State Mike Pompeo. Meanwhile his boss, former President Donald Trump, still considers as one of his achievements during his tenure in the mentioned position the conclusion of the so-called “Phase 1 Agreement” with the PRC in January 2018.

The main goal of the latter was to sharply reduce over the next few years the giant negative balance in trade with the PRC for the US, which has long been steadily at $400 billion. About the same figure (specifically, $380 billion) turned out to be the result of last year’s trade, the total volume of which amounted to about $690 billion.

 That is, nothing has changed in this, one of the key problems of bilateral relations and the blame for this lies almost entirely with those circles in US politics that almost simultaneously with the conclusion of the Phase 1 Agreement, without waiting for the positive outcome of its action, began to increase tariffs on most of the products purchased from China. By the way, on the fifth anniversary of the trade “tariff war” a special seminar was held in China, the participants of which recorded how counterproductive it was for the US itself.

Afterwards, political games with the very “decoupling” began, which now resulted in attempts to exclude the PRC from the “global supply chain.” First of all, in the field of advanced IT technologies. This is done mainly under the pretext of preventing the use of these technologies by China’s defense industry. The case is completely hopeless because historical evidence consistently demonstrates that a technology that originates someplace, like the cat let out of the bag, will inevitably become widespread.

But it seems that, as with Russia, the US is becoming more and more willing to go beyond IT and give the process of “decoupling” from the PRC an all-out character. It is an absolutely crazy idea, taking into account at least the fact that bilateral trade has been at a gigantic level of $700 billion for many years. Which demonstrates the interest of a large part of US business in maintaining trade and economic relations with the PRC, rather than transferring the profitable Chinese market, for example, to European competitors. As it is already happening today in the process of Chinese air carriers’ renewal of the available fleet of airliners.

The continuing ambivalence of US trade and economic policy toward China is reflected in the above-mentioned statement byJanet Yellen. Although it should be noted that along with the prevalence of hawkish clucking initiated by the political wing of the current US administration, the goal of “promoting healthy and fair relations with China, and cooperating with it to solve global problems” was also outlined in it.

The author should add that this last goal would be extremely difficult to achieve if the process of “decoupling” mentioned above were to develop in any significant way. Meanwhile, this is exactly what Janet Yellen’s colleague in the current US administration Katherine Tai had to do during her trip to Tokyo, where she held talks with Japanese Trade Minister Yasutoshi Nishimura. The main subject of which was the process of implementing the Indo-Pacific Economic Framework for Prosperity (IPEF) configuration project launched last May. It is fully in line with the trend to “decouple” from China. Although words about the intention to maintain trade and economic relations with China were also heard from the American guest.

Finally, it should be noted that the state, and consequently the near future, of relations between the two leading world powers remain largely in the realm of reality that today rests on the fragile shoulders of the same Janet Yellen, Catherine Tighe and Gina Raimondo.

 It is not easy for them to live in the same administrative company as the formidable holders of American political-military “muscle.”

Vladimir Terekhov, expert on issues of the Asia-Pacific region, exclusively for the online journal “New Eastern Outlook.

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