Another Xi-Biden Call In Prospect But China-US Relations Still Listing

THE NEXT CALL between President Xi Jinping and his US counterpart, Joe Biden, is edging closer.

Foreign Minister Wang Yi and his US counterpart, Secretary of State Antony Blinken (seen above), held a lengthy (5-hour) meeting on Saturday on the sidelines of the G20 foreign ministers meeting in Bali. Afterwards, Blinken suggested that the two leaders would ‘speak in the weeks ahead’.

Xi and Biden last spoke in November last year.

Reports suggest the Wang-Blinken meeting was what diplomats call candid, with Wang criticising Washington for what it regards as suppressing its rise and Blinken attacking Beijing’s support of Moscow in the war in Ukraine.

Blinken also laid out what Washington considers to be the boundaries of legitimate rivalry between the two powers. That adds some context to the unprecedented joint appearance in London last week by the heads of the US and UK domestic intelligence and security services, the FBI and MI5, calling China the ‘biggest long-term threat to [US and UK] economic and national security’.

However, by most accounts, the tone between Wang and Blinken remained professional and the discussion did not degenerate into a re-run of the infamous slanging match of the March 2021 meeting in Alaska.

A statement on the meeting issued by the Chinese embassy in Washington also warned the United States not to cross its well-known red lines, including Taiwan, Hong Kong and Xinjiang. It added that the bilateral relationship faced mounting challenges and was ‘still not out of the difficulties caused by the previous US administration’.

Blinken gave no hint about how extensively or even if the United States would roll back Trump-era punitive tariffs on Moscow. Biden said on July 8 that he had not yet decided on an issue that divides his administration.

US-China Cold War Brinksmanship Tested In Houston

BEIJING’S RETALIATION FOR the United States ordering the closure of its consulate-general in Houston, Texas will be telling. Will it be ready to up the ante and escalate the tensions with the Trump administration, in line with its more confrontational diplomatic stance of late?

The initial rhetoric has been combative. Wang Wenbin, the Foreign Ministry spokesperson, said at today’s regular ministry press briefing:

For some time, the US government has been shifting the blame to China with stigmatization and unwarranted attacks against China’s social system, harassing Chinese diplomatic and consular staff in the US, intimidating and interrogating Chinese students and seizing their personal electronic devices, even detaining them without cause. The unilateral closure of China’s consulate general in Houston on short notice is an unprecedented escalation of its recent actions against China.

Yet will more cautious voices in Beijing hold sway, as has been appearing to happen with the carefully calibrated proportionate responses to recent sanctions coming out of Washington?

The leaked recording of a telephone conversation between Foreign Minister Wang Yi and his Russian counterpart Sergey Lavrov gives a sense of what Beijing sees as the stakes, with Wang saying that Beijing feels the United States is reviving a ‘Cold War mentality’ in its policy toward China. Wang, himself may feel doubly concerned as his recent ‘olive-branch‘ speech calling for better bilateral relations was brushed off by US Secretary of State Mike Pompeo.

Our man in Washington sends word that a similar discussion is going on there about whether ‘Cold War’ is the right term for the rapidly deteriorating state of bilateral relations.

The Trump administration is repeatedly doubling down on its belligerent line towards China. It is seeking to reduce the interaction between the two countries, perhaps because it believes the enemy you do not know is easier to vilify. More likely, it is because, as outlined in its 2019 Worldwide Threat Assessment report to the US Congress, the administration sees all Chinese nationals in the United States — from diplomats to state journalists, students and workers at US technology companies — as witting or unwitting Party agents providing a conduit for US trade secrets, medical research and other US intellectual property to be spirited off to China.

It is determined to cut that off, disrupting Chinese technology companies’ supply chains, pressing allies to exclude Huawei Technologies from their 5G networks, suspending non-immigrant student visas and naming and shaming hackers. However, the general hardening of attitudes against China is occurring across the US political spectrum.

The critical question is, where does each side think the brink lies and is it the same place for both of them. Both leaderships are making that calculation through a domestic lens that focuses on retention of power, albeit in diametrically different political settings.

If the gap between the two answers is significant, it could be ruinous for everyone. An authentic Cold War’ between China and the United States would be more costly, destructive and dangerous than anything we have seen to date.

Myanmar And China Reset Rocky But Key Relationship

 

LITTLE UNDERLINES CHINA’S importance to Myanmar as much as Myanmar’s de facto leader Aung San Suu Kyi choosing to make a meeting with China’s foreign minister Wang Yi , seen above, her first with a foreign leader since her party historically took office on March 30.

China is Myanmar’s largest trading and investment partner, but the two countries have had a rocky relationship over the past few years. Points of dispute have been the fighting in the northeast of the country between Myanmar’s military and ethnic insurgent groups seeking greater autonomy, including ethnic Chinese Kokang, which periodically spills over into China, and controversial Chinese-backed infrastructure projects, notably the Myitsone dam near the headwaters of the Irrawaddy river and an oil and gas pipeline from Yunnan to the Indian Ocean that would let Chinese energy imports from the Gulf bypass the chokepoint of the Malacca Strait.

When Myanmar was still under military rule, China was able to take advantage of crony deals with Myanmar’s generals and some ethnic elites to exploit the country’s natural wealth; huge volumes of illicit timber and jade as well as drugs flow across the border into China.

Former President Thein Sein sent the relationship into a spin in 201o when he unexpectedly and unilaterally suspended the Myitsone project, which was being built by state-owned China Power Investment Corp. and its sub-contractor SinoHydro.

Wang and Suu Kyi at their meeting this week chose to emphasize resetting the relationship on a more positive footing, not discussing what her spokesman described as ‘controversial’ Chinese projects. Wang subsequently said that China would ‘guide’ Chinese companies operating in Myanmar to ‘respect’ Myanmar’s regulations, society, and environment.

That probably means paying a bit more than lip service to local concerns about environmental protection, land-grabs and lack of compensation for displaced communities, and bringing in Chinese labour to build Chinese-financed projects. A deal is likely to be struck to restart Myitsone in some form, probably addressing some of the social responsibility concerns and earmarking more of the electricity the dam will generate for consumption in Myanmar and less to be transmitted back to China.

Nothing is likely to happen until after the end of the rainy season in October at the earliest. However, Beijing has a diplomatic card it can play to support its infrastructure ambitions — helping to broker peace with some of Myanmar’s ethnic insurgent groups. Suu Kyi’s government will need Chinese cooperation if it is to generate the national peace settlement it has said is a priority.

However, while China will remain a key economic and political neighbour, Suu Kyi will want to be careful to avoid over-reliance on Beijing. She will also court U.S. trade, aid and investment and that from other regional powers, notably Japan and India, both of which have reasons of their own or wanting to counterbalance Beijing’s influence in a critical corridor between East and South Asia.