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Rukhsar Azamee is a graduate student at the school of professional studies, New York University. She can be found on Twitter @RukhsarAzamee. Divergent Options’ content does not contain information of an official nature nor does the content represent the official position of any government, any organization, or any group.
National Security Situation: The U.S. requires options to decrease trade tensions with China.
Date Originally Written: July 2, 2020.
Date Originally Published: October 28, 2020.
Author and / or Article Point of View: This article is written from the U.S-China relations point of view. It elaborates on how the U.S. and China can decrease the trade tensions and how they can continue their collaboration in the future.
Background: China’s economic growth in the last decades has started a new chapter in the international arena. After 9/11, America started the fight against terrorism in Afghanistan and Iraq[1] while China kept strengthening its economy. China became the world’s second-largest economy in 2010[2]. Currently, China is considered the world’s largest economy by the purchasing power parity (PPP). China’s Gross Domestic Product (GDP) by PPP is approximately $24.5 trillion, while America’s GDP by PPP is $20.5 trillion[3]. The 2017 U.S. National Security Strategy declared China as a competitor, and as a threat to the United States[4].
Recognizing China officially as a competitor is a policy shift for the U.S., the United States followed the “engagement” policy towards China’s rise under two assumptions in the past. The first U.S. assumption was that a strong China would serve the interests of America, and the second assumption was that a prosperous China would share American values by fostering regime change. The United States had not considered China a threat to its future[5].
China started modernizing its military by investing in missile and other military technology. From 2005 to 2014, China increased its military spending by 9.5% per year. China invested heavily in cyber operations. The argument is that China has strengthened its military to deter America’s intervention in its neighbors and to resolve Taiwan’s status[6]. China’s president Xi Jinping, unlike his predecessors, seeks to establish China as a Great Power again[7]. The competition is between the U.S. and China, and both countries are trying to prevail.
After the 2016 election in America, professor Yang Qijing of Renmin University stated in his report, “Trump Wins, Immense Challenges for China” implying that President Trump would focus on U.S. domestic economic growth. Yang said that Trump administration would seek a protectionist approach towards China and the U.S. started a trade war with China in 2018 by imposing tariffs on the import of Chinese goods in the U.S.[8] The trade war has hurt U.S-China relations, but it has also damaged the global economy[9]. The International Monetary Fund’s officials encouraged both countries to decrease the trade tensions in its 2019 reports[10].
Furthermore, China’s top talent in artificial intelligence (A.I.) end up working in America. Fifty-four percent of Chinese A.I. students come to the U.S. for their A.I education and research and then stay to work at U.S. firms[11]. Cyberattacks, and A.I theft remain a challenge in U.S.-China relations. A report by the U.S. National Security Agency noted 600 instances of Chinese hackers stealing confidential information from U.S. companies from 2009 to 2013 and a cybersecurity firm named Mandiant presented documents of 115 attacks against the U.S. by the Chinese People’s Liberation Army (PLA) in 2013[12]. The Trump administration decided to cancel the visa of those students/researchers with ties with China’s military in 2020[13].
China is trying to form a new tributary system through the Belt and Road Initiative (BRI) project. Sri-Lanka, as an example, can demonstrate China’s expansionist ambition. In 2017, Sri-Lanka was unable to pay the loan taken from China under the BRI project. Sri-Lanka defaulted and signed a 99-years lease of its port to Chinese state-owned enterprises[14]. On the other hand, the Quadrilateral Security Dialogue among the U.S., Japan, India, and Australia was re-launched in 2017 to counterbalance China’s assertive policies in the indo-pacific region[15].
Significance: The U.S. and China are the world’s two largest economies. The management of U.S competition with China will affect other countries’ policies towards China.
Option #1: The U.S. embraces China as a Great Power, promote strategic economic engagement with China, and create frameworks that would regulate A.I and cyberspace for both countries.
Risk: There are two risks. The first is that Japan, India, and Australia would work hard to stop China from becoming a Great Power[16]. The second is that China might seek global dominance after achieving regional power based on “Chinese dreams” or “great rejuvenation of the Chinese nation” strategy discussed by the Chinese president[17].
Gain: The U.S.-China competition is different and it sets itself apart in two ways. First, China has not shown desires for global dominance, and while they have been expanding their presence in the neighboring islands in the Pacific, China has not shown an appetite for the use of military force to enhance its influence[18] (in contrast to Russia’s approach to the Balkans for example, or even the supply of weapons to Syria). Second, China is seeking regional dominance through debt diplomacy. Therefore, this option allows China to achieve its goal, and it de-escalates the tension among both countries by being strategically engaged.
Option #2: The U.S. creates a veto power alliance against China within the Security Council of the United Nations. The veto power could block China’s foreign policies that do not meet international standards.
Risk: There is a high likelihood that Russia would not join this alliance. Russia is more likely to side with China against the U.S. than join a three-way pact[19].
Gain: Advanced nations with powerful economies blocking China would isolate it, putting pressure on China to change its foreign policies. Eventually, this option would ensure a peaceful international order by regulating China’s assertive actions, and it set a precedence for any rising powers to be mindful and comply with the international community in the future.
Other Comments: None.
Recommendation: None.
Endnotes:
[1] Four Scenarios for U.S.-China Relations and What They Mean for Japan
https://www.tokyoreview.net/2019/05/four-scenarios-us-china-relations
[2] China overtakes Japan as world’s second-largest economy
https://www.theguardian.com/business/2010/aug/16/china-overtakes-japan-second-largest-economy
[3] The world Bank – Open Data- “GDP, PPP (current international $) – China, United States”
https://data.worldbank.org/indicator/NY.GDP.MKTP.PP.CD?locations=CN-US
[4] 2017 U.S. National Security Strategy
https://www.whitehouse.gov/wp-content/uploads/2017/12/NSS-Final-12-18-2017-0905-2.pdf
[5] What Went Wrong? U.S.-China Relations from Tiananmen to Trump- by James B. Steinberg
https://tnsr.org/2020/01/what-went-wrong-u-s-china-relations-from-tiananmen-to-trump
[6] The Chinese Military: Overview and Issues for Congress- Ian E. Rinehart -Analyst in Asian Affairs March 24, 2016
https://fas.org/sgp/crs/row/R44196.pdf
[7] Saving America’s Alliances- By Mira Rapp-Hooper, March/April 2020
https://www.foreignaffairs.com/articles/united-states/2020-02-10/saving-americas-alliances
[8] Towards Economic Decoupling? Mapping Chinese Discourse on the China–U.S. Trade War- by Li Wei
https://academic.oup.com/cjip/article/12/4/519/5650490
[9] US-China trade Dangerous miscalculations
https://www.economist.com/leaders/2019/08/08/dangerous-miscalculations
[10] IMF’s country reports/Article IV consultation 2019, Executive Board Assessment (China and U.S.)
https://www.imf.org/en/countries
[11] A U.S. Secret Weapon in A.I.: Chinese Talent
https://www.nytimes.com/2020/06/09/technology/china-ai-research-education.html
[12] International Law Norms, Actors, Process (Aspen Casebook Series) 5th – Jeffrey Dunoff (State Responsibility: Attributing Malicious Cyber Conduct)
[13] A U.S. Secret Weapon in A.I.: Chinese Talent
https://www.nytimes.com/2020/06/09/technology/china-ai-research-education.html
[14]H.R. McMaster, “How China Views the World,”
https://www.realclearpolitics.com/2020/04/19/how_china_sees_the_world–and_how_we_should_see_china_508340.html
[15] The US-Japan-India-Australia Quadrilateral Security Dialogue: Indo-Pacific alignment or foam in the ocean?
https://www.fiia.fi/en/publication/the-us-japan-india-australia-quadrilateral-security-dialogue
[16] The US-Japan-India-Australia Quadrilateral Security Dialogue: Indo-Pacific alignment or foam in the ocean?
https://www.fiia.fi/en/publication/the-us-japan-india-australia-quadrilateral-security-dialogue
[17] H.R. McMaster, “How China Views the World,”
https://www.realclearpolitics.com/2020/04/19/how_china_sees_the_world–and_how_we_should_see_china_508340.html
[18] Saving America’s Alliances- By Mira Rapp-Hooper, March/April 2020
https://www.foreignaffairs.com/articles/united-states/2020-02-10/saving-americas-alliances
[19] CHINA AND THE RETURN OF GREAT POWER STRATEGIC COMPETITION- by BRUCE JONES- P8
https://www.brookings.edu/wp-content/uploads/2020/02/FP_202002_china_power_competition_jones.pdf