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Foreign Policy

The US is Responsible for Damaged Relations with China

Jul 26, 2018
  • Wu Zurong

    Research Fellow, China Foundation for Int'l Studies

The Sino-US relationship is among the most important in the world, and its deterioration has an impact far beyond the two countries. Therefore, there are countless reasons to foster positive relations and not a single reason to damage them. But, unfortunately,recent damage to Sino-US relations has been felt by a growing number of people. It has also aroused heated discussion on whether or not China and the US are moving towards a new Cold War. Some people even believe that the two countries have fallen into the so-called Thucydides trap. Who should be held responsible for the damages?

First and foremost, the US has broken its word that it would work with China to advance bilateral relations. Since the Trump administration assumed office in January 2017, the US has, on many occasions, expressed its readiness to promote Sino-American cooperation in a number of fields, including security, economics, and sociocultural affairs. In light of this, the trade war the US unilaterally launched against China has damaged its credibility. The US has taken a number of actions to harm the fundamental interests of Sino-US relations, thus violating its previous commitments. American failure to keep faith on vital issues have brought their trustworthiness into question.

Second, the waves of tariffs imposed on China have already caused serious damage to Sino-US relations and will have unexpected, catastrophic consequences. Despite four rounds of serious negotiations, including a joint statement issued on May 19, as well as a consensus on energy and agriculture reached in early June, the US side has reneged, provoking a trade war. On March 8, the US decided to impose a 25% tariff on all steel imports and a 10% tariff on all aluminum imports. China would have about $3 billion of its exports affected. Then, on July 6, an additional 25% tariff on Chinese exports worth $34 billion took effect. According to the US, another $16 billion worth of Chinese exports would soon be hit with a 25% tariff. On July 10, the US released a list of $200 billion worth of additional China exports that would face a 10% tariff sometime after August. On July 20, it was even reported that President Trump is “ready to go” with $500 billion in tariffs on all imports from China. Obviously, such unilateral and protectionist measures by the United States would strangle almost all bilateral trade, hitting hard at the economic relations between the two countries.

On the investment front, though US investment in China is still growing this year, Chinese investment in the US has totaled only $1.8 billion between January and May. That’s a 92% drop compared to the same period in 2017; the lowest level in seven years. The unfair US restrictions on Chinese investment in the name of national security is a major reason for that drop.

Third, the US has recently taken a series of actions to interfere in China’s internal affairs, including encroaching upon China’s sovereignty and territorial integrity by violating the One China principle. On March 16, Trump signed the Taiwan Travel Act, allowing high-level US officials to visit Taiwan and vice versa. In the National Defense Authorization Acts for FY 2018 and FY 2019, there are provisions that encourage considering the reestablishment of exchanges between the US navy and Taiwanese navy and providing increased military cooperation with Taiwan. In April 2018, the US authorized domestic manufacturers to sell submarine technology to Taiwan. Additionally, US navy vessels sailed into China’s territorial waters in the South China Sea without permission in March and May 2018. A senior US official, Assistant Secretary of State Marie Royce visited Taiwan in June 2018.

Fourth, the US seems to seek out confrontation and reject apparent progress from dialogue and exchanges. Since the Trump administration assumed office, the two countries have agreed to set up the Diplomatic and Security Dialogue, the Comprehensive Economic Dialogue, the Law Enforcement and Cyber Security Dialogue, and the Social and Cultural Dialogue. Ever since the first round of meetings concerning the four dialogues was held last year, it seems that any momentum has been lost, with none of the second-round talks having been held this year so far. It is another rare, unfriendly action by the US to disinvite China’s navy from participating in the 2018 Rim of the Pacific (RimPac) Exercises.

China has done its utmost to maintain the Sino-US relations. With quite a lot of patience, it has explained its development plans in detail, in order to help the US avoid any misunderstanding China’s strategic intentions. China has insisted on finding solutions to the disputes, both trade and otherwise, through dialogue and negotiation. It has made serious commitments during the negotiations to greatly increase imports from the US so as to reduce the trade surplus. China has exercised maximum restraint over groundless American accusations concerning so-called intellectual property rights theft, unfair trade practices, the manipulation of currency exchange rates, and so on for the sake of overall bilateral relations. Of course, China is firm in safeguarding its sovereignty, territorial integrity, and development interests. The responses to the US’s hegemonic and bullying tariff imposition are merely intended to safeguard free trade and the world trading system, as well as China’s own interests.

It is not pure empty talk to say that China and the US have more common interests than differences or that the economies of the two countries are deeply intertwined. The growing pain felt by businesses in both countries in the initial battles of the trade war tells us that it will make both sides suffer. If the US obstinately clings to its tariff tactics and expands the trade war, potential damage to both countries would be hard to estimate. No one knows for sure if current American economic growth will soon come to an end as a result of the unfolding of the trade war, or if the US “leadership” role in the world will be significantly weakened without cooperation and help from its major trading partners. Therefore, it is time for the US to change course and come back to the negotiating table with genuine sincerity. They must work together to find win-win solutions to the trade disputes.

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