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Foreign Policy

Lessons from the Recent Thaw in Sino-US Relations

Apr 24, 2019
  • Peng Nian

    Director of Research Centre for Asian Studies, China

Tensions between China and the US seemed to have lessened since significant progress has reportedly been achieved in the recent Sino-US trade negotiations. According to US President Donald Trump, the final deal will be finalized within four weeks — this new deadline being the first clear message that the US has released from the renewed trade negotiation process. Although senior American officials, including Treasury Secretary Steven Mnuchin, then clarified that there is no timeline on the trade negotiations, they have acknowledged that both sides have reached a consensus on the main principles of the trade dispute and the trade negotiation is nearing its end. Given this, it is safe to conclude that the “trade war” between China and the US is more likely to end in the near future, though economic competition will last for many years.

Why did both sides decide to resolve the trade issue, and what lessons could be drawn from the eased trade tensions between China and the US? In my opinion three points are worth noting.

First of all, engagement is still the necessary approach for Washington to deal with a rising China. The United States has to engage with China in many areas due to their high interdependence, especially in economic terms.

Take the trade negotiations for example: the Trump administration launched a “trade war” towards China in order to pressure Beijing to accept a new trade arrangement that favored American interests. Yet such coercive measure did not result in positive outcomes for the US. But more than that, it prompted countermeasures from China and thus damaged American economic interests. In other words, the United States cannot afford the costs of cutting off trade ties with China.

It is in this context that the White House suspended the escalation of the “tariff war” and started trade negotiations with China. Thanks to these negotiations, both sides agreed to reach a new and fair trade deal which could be enforced and supervised. In fact, if a trade agreement can be reached, Sino-US trade relations could be effectively managed and economic cooperation between the two countries would also be enlarged and deepened. As Secretary Mnuchin said on April 13, the new trade deal would make a significant change in US-China trade relations, in which American enterprises would get more access to Chinese markets than ever before.

On the other hand, Washington has moved to contain China due to a belief that its engagement policy has failed. Indeed, American officials and scholars in Washington have increasingly criticized the engagement strategy which was adopted by previous U.S. administrations to shape China’s behavior and push forward democratization in China.

However, they feel frustrated that China has gained great economic benefits without making substantial progress in political reforms as they wished. They therefore switched to a hardline policy by which US policymakers intend to pressure Beijing to go back to America’s preferred reform road by containing China with the help of its allies and partners.

Yet the US has also failed in this effort. For instance, China has moved closer to the EU since Chinese President Xi Jinping visited three countries in Europe and Chinese Premier Li Keqiang attended a recent summit meeting with EU leaders in Brussels.

Meanwhile Italy has joined the Belt and Road Initiative (BRI). Furthermore, China and the EU have just released a joint declaration on maintaining free trade and opposing protectionism, a clear message showing their consensus to preserve the world economic order. Washington has also failed to prevent its allies and partners such as the Philippines and UK from cooperating with China. In fact, in the conflict between China and the US, many countries would prefer not to take sides between the two giants.

Second, both China and the US should continue to send goodwill and make mutual compromises. In fact, both sides have released goodwill messages since the beginning of the “trade war”. For example, China has imported a large number of agricultural products from the US since Trump suspended the “tariff war.” More recently, China has also banned fentanyl, a main component of drugs that have been devastating American citizens, in order to convince America that China is serious about responding to US concerns.

Moreover, both Beijing and Washington have made mutual compromises in the trade negotiations so that a trade agreement could possibly be made. For Beijing, it has agreed to import more American goods and services, and open more markets to American companies. It has also accepted the US suggestion of establishing an enforcement office for a potential trade deal, and introduced laws and regulations protecting foreign investment in China.

Third, exercising self-restraint is the key for maintaining good relations between China and the US. Relations cannot improve unless both sides make significant progress on resolving existing issues, and succeed in cooling down the tensions that have flared over some hot-button issues in their bilateral ties. In reality, both China and the US have taken some actions to avoid escalating tensions in the past months, thus creating the current positive atmosphere for negotiations.

In the South China Sea, nothing really dangerous has happened since a US Navy ship almost collided with a Chinese vessel in September 2018. Both sides agreed to offset the risks of possible clashes in the South China Sea and avoid misunderstandings and misjudgments through better communication, especially since US Chief of Naval Operations John Michael Richardson’s China trip in January of this year. Trump has also reportedly considered the temporary suspension of the arms sale of F-16V fighter jet to Taiwan until the end of the US-China trade negotiations.

To conclude, now is a good time for both China and the US to further repair their wounded relations and create a warmer bond which would serve the interests of both countries and their peoples. To this end, both sides should continue to engage with each other, make mutual compromises at the proper time, exercise self-restraint, and prevent the situation from getting worse.

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