Co­op­er­a­tion is the fu­ture of ties with US

China Daily (Canada) - - VIEWS -

Premier Li Ke­qiang re­it­er­ated in his news con­fer­ence onWed­nes­day the vi­tal im­por­tance of healthy and sus­tain­able Sino-US ties for both coun­tries, es­pe­cially em­pha­siz­ing that the two coun­tries should avoid a trade war.

The premier’s con­fir­ma­tion that both coun­tries are work­ing closely on a pos­si­ble meet­ing be­tween Pres­i­dent Xi Jin­ping and hisUS coun­ter­part Don­ald Trump, showed it’s a big con­cern for both coun­tries to put bi­lat­eral ties on the right track af­ter Trump was sworn in.

US Pres­i­dent Don­ald Trump’s ag­gres­sive stance against China dur­ing the elec­tion cam­paign and im­me­di­ately af­ter he was sworn in raised con­cerns over the fu­ture of Bei­jing-Wash­ing­ton trade re­la­tions. Trade im­bal­ance and dis­putes are not new­for theUnited States and China. But they have es­tab­lished some ef­fec­tive mech­a­nisms, such as the Strate­gic and Eco­nomic Di­a­logue and the Si­noUS Joint Commission on Com­merce and Trade, to re­solve them.

A tip­ping point, how­ever, was reached last year when the antiglob­al­iza­tion tide com­pounded the trade im­bal­ance prob­lem, and it was used as a cam­paign card by Trump to win the elec­tion.

But Trump’s ad­dress to theUS Con­gress onMarch 1 al­lowed the world to see a dif­fer­ent leader, a leader with the mer­its of some pre­vi­ousUS pres­i­dents. His tone on China in­di­cated he was re­al­iz­ing the im­por­tance of China. And there is rea­son to ex­pect Trump’s at­ti­tude to­ward China to be more rea­son­able in the fu­ture.

Of­fi­cials from both coun­tries main­tain reg­u­lar, in­tense com­mu­ni­ca­tions at the of­fi­cial work­ing level. But a meet­ing be­tween the two heads of state will help fur­ther ease ten­sions and prompt of­fi­cials from both sides to work more closely to­gether for the ben­e­fit of not only theUnited States and China, but also the rest of the world.

First, both sides should work to­gether to find a truly sci­en­tific method to mea­sure the real state of bi­lat­eral trade. Since the cur­rent method can­not sep­a­rate ex­ports from re-ex­ports, theUS’ trade deficit with China is ex­ag­ger­ated. Also, the cur­rent ac­count doesn’t give a com­plete pic­ture of theUS’ in­ter­na­tional trans­ac­tions, and ex­cludes a large num­ber of fi­nan­cial flows, which could be viewed as “ad­just­ment items”. When theUS has a trade deficit with China, it ac­tu­ally means it has a fi­nan­cial sur­plus with China.

Sec­ond, fur­ther open­ing up their ser­vices sec­tors, es­pe­cially the fi­nan­cial ser­vice mar­ket, should be on the pol­icy radar of China and theUS both. Trump seems in­clined to loosen gov­ern­ment reg­u­la­tions onWall Street. And China plans to make its fi­nan­cial sec­tor more ef­fi­cient and pro­vide high-qual­ity fi­nan­cial ser­vices to the public. There­fore, by fur­ther open­ing up their fi­nan­cial ser­vice mar­kets, the two sides will not only ex­pand do­mes­tic de­mand but also cre­ate more mu­tual prof­itable op­por­tu­ni­ties for Chi­nese andUS com­pa­nies.

Third, Trump is plan­ning to re­vive theUS en­ergy sec­tor, and China has a huge de­mand for oil and gas. So the two sides should en­hance co­op­er­a­tion in the oil in­dus­try. China has to im­port about 60 per­cent of its oil, mainly from Or­ga­ni­za­tion of the Pe­tro­leum Ex­port­ing Coun­tries mem­bers, to meet the do­mes­tic de­mand. This means there is room for theUS oil com­pa­nies to fill. Be­sides, theUS gov­ern­ment should al­low moreUS com­pa­nies to sell oil­field tech­nolo­gies to China and re­lax some reg­u­la­tions on Chi­nese in­vest­ment lim­its inUS oil re­finer­ies.

Fourth, Trump has an am­bi­tious in­fra­struc­ture in­vest­ment plan, which China can help ful­fill be­cause of its ex­per­tise in in­fra­struc­ture con­struc­tion.

And fifth, both sides should make ef­forts to com­plete the China-US Bi­lat­eral In­vest­ment Treaty ne­go­ti­a­tion now that it has reached a de­ci­sive state. Mak­ing bi­lat­eral trade and in­vest­ment eas­ier will make made-in-US prod­ucts more eas­ily ex­portable to China, and al­low Chi­nese com­pa­nies to ex­e­cute merger and ac­qui­si­tion deals inUS oil as­sets and take over some bank­rupt com­pa­nies, which will al­le­vi­ate the un­em­ploy­ment prob­lem in theUS.

Con­sid­er­ing China and theUS are now so deeply in­ter­con­nected that the ac­tions of one can have a huge im­pact on the other, and vice-versa, nei­ther can afford the cost of bad re­la­tions. This means Chi­nese andUS lead­ers will not in­ten­tion­ally un­der­mine the most im­por­tant bi­lat­eral re­la­tion­ship in the world. As such, if both sides deepen their co­op­er­a­tion, and en­hance mu­tual un­der­stand­ing, China-US re­la­tions will be less dis­cor­dant.

... it’s a big con­cern for both coun­tries to put bi­lat­eral ties on the right track af­ter Trump was sworn in.

The au­thor is a re­search fel­low at and di­rec­tor of the Divi­sion of Amer­i­can Eco­nomic Stud­ies at the In­sti­tute of Amer­i­can Stud­ies, China In­sti­tutes of Con­tem­po­rary In­ter­na­tional Re­la­tions.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.