Beijing And Washington Look For Little Wins To Stop Things Getting Worse

TO SAY THAT Beijing and Washington are resetting their fractious relations would be way overstating the case. Yet, in the narrow area of bilateral trade, there appears to be effort being made on both sides to talk to each other more, or at least talk to each other about talking to each other more.

The readouts of the video call Vice Premier Liu He and US Trade Representative Katherine Tai held on October 9 both emphasise a resolve to resolve trade disputes through consultation. However, the tone of how that was expressed differs in the two versions.

If not explicit, there is still an echo in the Chinese readout of it being the United States responsibility to conduct talks in the manner China wishes. In contrast, the US readout speaks more to the substantive issues of difference, albeit in the most general agenda-listing way.

The US readout is an exemplar in brevity, befitting Tai’s mastery of speaking without saying anything and, to mix metaphors, plays an exceptionally straight bat on the issue of lifting Trump-era tariffs and sanctions, a priority ask of the Chinese side. It added nothing publicly to Tai’s recent statement about restarting the tariff exclusion process, which was not that illuminating in the first place and is being driven by the concerns of China-dependent US electronics manufacturers more than anything.

The day before Liu and Tai spoke, China’s ambassador to Washington, Qin Gang, took a more confrontational line towards the Biden administrations continuation of another Trump strategy, excluding Chinese companies from access to US capital markets and Chinese investors from US technology companies in the name of national security. If this continues, Qin said, there will be “serious consequences”.

Beijing appears to believe that its approach is achieving results and will point to the resolution of the extradition order against Meng Wanzhou as evidence. The Biden administration has undoubtedly been more accommodating to China’s sensibilities than Trump, although that is a low bar.

Yet it also seems to be running on two tracks, a hard and a soft line. That may just mean that the Biden administration is itself split on how hard it should be on China, with Biden, by inclination and political calculation, leaning towards a softer approach. One thing he does not need now domestically is another foreign policy crisis.

Equally, he has many constituencies to satisfy within his Democratic Party. Their interests span trade to national security and human rights. Most will be happy to see a continuation of the hardline course Trump charted. Similarly with the coalition of allies he is trying to bring along in a united front of nations who see China as their leading strategic competitor.

It may thus be that Biden is seeking to compartmentalise his China policy so that a floor can be put under the state of the relationship to prevent it from deteriorating further. Four silos readily suggest themselves: climate, trade, national security and human rights, probably in that order of thorniness, or to put it another way of distance from Beijing’s ‘red lines’.

Climate is a global issue and falls into the multilateral institutional diplomacy with which Biden is comfortable. Trade, too, once the febrile and unpredictable tweets and slavish devotion to sanctions that were the hallmarks of the Trump administration are removed from policymaking, becomes essentially a technical discussion between officials and amenable to fudge that few outside trade nerds will examine closely behind the assertions of achievement.

It also provides a framework of conventional diplomacy that can provide an anchor for the broader relationship. The complex bilateral issues of national security and the intractable ones of human rights then can find a safe harbour where they may not be resolved but can bob around while being less likely to cut free and cause greater havoc.

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Filed under China-U.S., Trade

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