Trade War: US-China relations at a crossroads
The world economy has been disrupted by tit-for-tat measures. The US and China are engaged in clashes that cover trade, technology, space, military, and ideology
Over the course of the Covid-19 pandemic, observers have been witnessing the US-China relations reaching a point from where there is little hope of escape. There are obviously good reasons for that, but Beijing has taken a far tougher line on the international stage. The deviation from its usual diplomatic record has startled even the most experienced observers as they have been wondering if China's foreign policy has altered radically.
In the essay "The Next Great War," Richard Rosecrance warns that friction and misunderstanding between the two superpowers can lead to conflict without proper leadership. China and America are not going to engage in "traditional warfare," but the tension is rising.
Their relations have spiralled to a historic low than at any point since Nixon's visit to China to start normal diplomatic relations almost 50 years ago. As the presidential election in the US draws near, the possibility of mismanagement is looming large.
The world economy has been disrupted by tit-for-tat measures. The US and China are engaged in clashes that cover trade, technology, space, military, and ideology. Moreover, American retreat from global leadership creates a unique opportunity for China to seize the leading position.
The world order America has made and sustained for the last seven decades is facing many challenges, but Beijing poses the biggest headache for the liberal order. The ultimate question is: Can Xi's China take advantage of the void in leadership and change the world we know?
The year 2020 came with troubles for the Chinese Communist Party (CCP). But it did not remain on the back foot for a long time. Beijing scrambled to protect its global reputation amid accusations of not being transparent in handling the novel coronavirus pandemic.
Soon, the epidemic was contained within its boundary and "mask diplomacy" was launched to cast itself as a leader in the global health sector, similar to its portrayal of itself as leaders on many fronts. There is no stopping for China yet.
Indeed, the Chinese government has been involved in strategic attacks on virtually every foreign policy direction, which was unprecedented. It has essentially assimilated Hong Kong into Mainland China, escalated tensions over the South China Sea, kept Australia under high diplomatic pressure, used brutal forces against India over border disputes, and became more expressive in its castigation of Western democracies.
The CCP in the past usually maintained a stable security environment and sought to achieve its goals without generating much outcry on the international stage. Recent actions taken by Beijing contradict such vigilance of the past.
The chaos of the pandemic, subsequent messes in the financial domain, and deliberate abandonment of the global leadership role by the Trump administration created a vacuum for someone else to fill in. There is no denying in the fact that a fundamental change is underway. Xi Jinping may simply be taking advantage of that and the world may be getting the first glance of what will come next as China becomes more and more assertive.
Increasingly, the clash between the world's biggest economies is shaped by ideological standpoints evidenced by recent speeches by the US and Chinese officials. The rhetoric is reminiscent of the Cold War.
Trump's America First ultra-nationalism interplays with Jinping's authoritarian playbook, which is leading to concurrent tensions. In rhetoric that reminds one of the cold war, the secretary of state, Mike Pompeo, announced on July 23 that Xi Jinping is engaged in a decades-long campaign for global dominance, and that America and other democracies must stand up and fight back.
Uncertainties and turmoil about trade war hurt businesses and weakened the global economy. The tariff strategy of Trump seeks to encourage customers to purchase American goods by raising the expense of imported goods. The US has slapped tariffs on more than $550 billion worth of Chinese products, and China has reciprocated with tariffs on more than $185 billion worth of American goods.
In reference to banning Chinese tech giants, Chinese Foreign Ministry spokesman Wang Wenbin accused America of "using national security as an excuse and using state power to oppress non-American businesses." Before that, Foreign Minister Wang Yi urged his American counterpart to reject decoupling, blaming America for artificially creating the so-called "new Cold War".
Mike Pompeo encouraged American businesses to ban Chinese apps from their app stores, as part of his "Clean Network" policy intended to stop Chinese authorities from breaching US citizens' personal data. His statement produced alarm in China. Hu Xijin, editor of the Communist Party-affiliated newspaper Global Times, indicated that a division on the internet would harm trade and commerce, and end up in "hot war".
Tensions between Washington and Beijing ramped up after the Trump administration announced a potential ban on TikTok and tried to compel Tencent to sell the popular Chinese video app to Microsoft. TikTok is just another target caught up in the middle of deteriorating US-China relations following the blacklisting of ZTE, Huawei and other Chinese companies.
While the company's fate hangs in the balance, one thing that is for sure is that TikTok is not going to be the last victim in the US-China rivalry vying for technological supremacy. Pompeo is now pressing for the withdrawal from Google and Apple software platforms of "unreliable" Chinese mobile applications.
Drawing on prior protectionist actions, these developments may lead to a further rift in bilateral economic relations and promote an ultimate decoupling between the two countries. Of all the ways in which the two countries grow apart, technology and supply chains are of the utmost importance for the world economy.
Both Trump and Xi Jinping are to blame for this. Since Jinping came to power in 2013, Beijing's foreign policy has become more assertive and aggressive. It has contributed to the recent strains by enacting national security law in Hong Kong, repressing Muslim minorities in Uighurs, which caused the US to penalise by attributing sanctions, banning Huawei and other Chinese tech giants.
As the election draws near, Trump might take a harder line on China to divert attention from mismanagement at home. To many analysts, Trump's whimsical decisions are hurting American businesses, both at home and abroad, especially in China. But China will wait to retaliate in full scale until the election.
Even if Joe Biden wins the election, the American strategy will not change dramatically with regards to China. Biden has to come up with a new, practical strategy for standing up to China. The atrocities of Muslims in Uighur and the abolition of Hong Kong's rule of law warrant a stronger response than the world has so far provided.
Chinese territorial aspirations in the South China Sea are troubling for its neighbours. Beijing is taking advantage of its economic leverage over trading partners. The West is weighing the challenges and threats Xi's China poses. Washington's extreme responses under Trump differ fundamentally from its allies. The Biden administration might take different, uniform policies that align with Europe.
Sabyasachi Karmaker is a final-year student of international relations at the University of Dhaka.