China-US com­pe­ti­tion: marathon, not box­ing

People's Review - - MEDIAWATCH -

On May 10-11, fa­mous Amer­i­can think tank Cen­ter for Strate­gic and In­ter­na­tional Stud­ies or­ga­nized two sym­po­siums in Wash­ing­ton, DC, with the themes "Global Eco­nomic Or­der and China-US Re­la­tions" and "China-US Re­la­tions in the Past 40 Years". Nearly 200 fig­ures from US po­lit­i­cal and think tank cir­cles, in­clud­ing Sen­a­tors, at­tended the two events in which Chi­nese am­bas­sador to the US, Cui Tiankai, gave the key­note speech. For­mer US deputy sec­re­tary of state and for­mer pres­i­dent of the World Bank, Robert Zoel­lick, made the din­ner speech. Wang Wen, the ex­ec­u­tive dean of Chongyang In­sti­tute for Fi­nan­cial Stud­ies, Ren­min Univer­sity of China and ex­ec­u­tive di­rec­tor of Sino-US Peo­ple-to-Peo­ple Ex­change Re­search Cen­ter, spoke at the open­ing cer­e­mony and par­al­lel sessions. The full text of Wang Wen's speech: Thanks for the in­vi­ta­tion. It is very im­por­tant to hold such a large think tank di­a­logue as both Chi­nese and Amer­i­can so­ci­eties are show­ing anx­i­ety about bi­lat­eral re­la­tions in the fu­ture. This year is spe­cial, for the world as well as China and the US. This year marks the 10th an­niver­sary of the in­ter­na­tional fi­nan­cial cri­sis. It is also the 40th an­niver­sary of the es­tab­lish­ment of China-US diplo­matic re­la­tions and China's Re­form and Open­ing-up. Hence, I think it is nec­es­sary to re­assess the change in US power in the past 10 years and the his­tor­i­cal ex­pe­ri­ences of the de­vel­op­ment of China-US re­la­tions in the last four decades. I have five main ar­gu­ments: First, China has been ris­ing in the past 10 years while the US has not de­clined. In 2017, China's GDP reached nearly $13 tril­lion, ris­ing 6.9 per­cent over the last year. Si­mul­ta­ne­ously, GDP of the US was $18 tril­lion. The to­tal amount of the two coun­tries' GDP ex­ceeded 40 per­cent of world out­put. China's eco­nomic share rose from 7.3 per­cent in 2008 to 15 per­cent last year, while that of the US has sta­bi­lized be­tween 23 per­cent to 25 per­cent in the past 10 years, plung­ing in 2011 but re­cov­er­ing to 25 per­cent this year. There­fore, China's rise does not chal­lenge US dom­i­nance of the world econ­omy. In­stead, there is still a big gap be­tween China and US eco­nomic ag­gre­gates. What's more im­por­tant, China has con­trib­uted around 30 per­cent of global eco­nomic growth, which means that 5 per­cent of US eco­nomic growth came from China's growth. It does not in­clude those noneco­nomic fac­tors such as China's long-term hold­ing of US gov­ern­ment bonds and sup­port­ing Wash­ing­ton in the in­ter­na­tional rul­ing sys­tem. The US should thus ap­pre­ci­ate China for sup­port­ing its eco­nomic re­cov­ery.

Scape­goat­ing China

Sec­ond, the US so­ci­ety is mis­taken in mak­ing China the scape­goat for its own prob­lems. In the last two years, I vis­ited the US about 10 times go­ing around 10 states. Af­ter talk­ing with hun­dreds of Amer­i­can friends, look­ing at US me­dia cov­er­age and read­ing re­search re­port pub­lished by US think- tanks, I have felt the US is ex­ces­sively anx­ious about China's rise. Wash­ing­ton is al­ways think­ing that China would re­place, even de­feat the US and then lead the world. Ob­vi­ously it is wrong. There is no coun­try that could de­feat the US, ex­cept the US it­self. China-US com­pe­ti­tion is a marathon, not a box­ing match. As a marathon run­ner, I un­der­stand that the key to win­ning is keep­ing all parts of the body in the best con­di­tion and avoid mak­ing mis­takes. In the past 40 years, es­pe­cially af­ter the end of the Cold War, China is the coun­try which made the least mis­takes. China has been con­stantly pro­mot­ing do­mes­tic re­forms to meet peo­ple's needs, not fight­ing wars and main­tain­ing so­cial sta­bil­ity. Up till now, China has done re­ally well in this marathon.

Strate­gic mis­takes

The US has also done a good job. US tech­nol­ogy has been lead­ing glob­ally and Amer­i­can cul­ture has spread across the world. How­ever, the US made sev­eral mis­takes. It started the Iraq War and trig­gered the in­ter­na­tional fi­nan­cial cri­sis. Even worse, US soft power de­clined. The global im­age of the US has taken a beat­ing. . In­stead of be­com­ing the bea­con of free­dom and democ­racy, the US has be­come syn­ony­mous with self­ish­ness and over­bear­ing power. Ac­cord­ing to in­ves­ti­ga­tion by Pew Re­search Cen­ter, for the first time China's global im­age is bet­ter than the US'. It is some­thing the US should in­tro­spect about. Third, the US over­es­ti­mated China's global strat­egy, while un­der­es­ti­mat­ing its ri­val's pos­i­tive bias to­ward it. China never says of­fi­cially that it is the global leader. With firm sup­port of the in­ter­na­tional sys­tem es­tab­lished af­ter World War II, China could never be the revo­lu­tion­ary power in the in­ter­na­tional sys­tem. The in­dus­trial ar­chi­tec­ture of China and the US is com­ple­men­tary. They should strengthen in­dus­trial co­op­er­a­tion to pro­vide new dy­nam­ics to eco­nomic de­vel­op­ment of both sides. China has al­ready be­come a mid­dlein­come coun­try. Ac­cord­ing to data from The Wash­ing­ton Post in Jan­uary 2018, China's com­mod­ity con­sump­tion will reach $5.8 tril­lion this year. In three years, China may sur­pass the US, be­com­ing the coun­try with the largest con­sump­tion. Cur­rently, con­sump­tion that con­trib­uted 58.8 per­cent of GDP is the most im­por­tant im­pe­tus to China's eco­nomic growth. In other words, con­sump­tion has be­come the largest dy­namic of China's eco­nomic growth. It is a big op­por­tu­nity for the US. In Novem­ber 2018, China will host the first Im­port Expo in Shang­hai, pur­chas­ing com­modi­ties from all over the world. The US should take this chance and go to China to of­fer the best goods. China has three main tasks: pre­vent­ing a fi­nan­cial cri­sis, re­duc­ing poverty and pre­serv­ing the ecol­ogy. All th­ese tasks can be an op­por­tu­nity for the US in terms of ex­pe­ri­ence shar­ing, clean en­ergy, and tech­nol­ogy ex­port. Fourth, the trade im­bal­ance be­tween China and the US has been ex­ag­ger­ated. Based on the sta­tis­tics from BEA, in 2015, the gross rev­enue of Amer­i­can com­pa­nies in China was $372 bil­lion, out of which $232 bil­lion came from US firms' sub­sidiaries in China and $150 bil­lion di­rectly from US ex­port to the coun­try. Mean­while, Chi­nese com­pa­nies' gross rev­enue in US (in­clud­ing goods and ser­vices) was $402 bil­lion, out of which $10 bil­lion from Chi­nese firms' sub­sidiaries in the US and $393 bil­lion di­rectly from China's ex­ports to US. From this per­spec­tive, the US trade deficit with China is only $30 bil­lion. In 2015, the to­tal value of global trade in ser­vice was $9.4 tril­lion. The US ac­counted for $1.2 tril­lion while China only ac­counted for $600 bil­lion. The US is still the largest coun­try for trade in ser­vice ex­port, ac­count­ing for 15 per­cent of global share. It is fol­lowed by the UK 6.9 per­cent, Ger­many 5.6 per­cent and France 4.9 per­cent. China only ac­counts for 4.3 per­cent, rank­ing fifth. In ad­di­tion, China is the sec­ond largest coun­try for trade in ser­vice im­port. China's trade in ser­vice deficit with the US is around $140 bil­lion.

His­tory les­son

Re­view­ing the his­tory of the es­tab­lish­ment of China-US diplo­matic ties in the past 40 years, we could con­clude that bi­lat­eral re­la­tions are far more com­pli­cated than they were be­tween US and the USSR. While US-USSR re­la­tions fo­cus on com­pe­ti­tion and con­flict, China and the US are highly in­ter­de­pen­dent. With both com­pe­ti­tion and co­op­er­a­tion, trade re­la­tions of the two coun­tries are also too hard to be driven a wedge into. Hence, I agree with Dr Henry Kissinger's say­ing that China and the US need to co-evolve to face global chal­lenges jointly rather than fight­ing a box­ing match. Fifth, the path China-US re­la­tions will take in the com­ing 40 years is hard to pre­dict, while one can be cer­tain they will not take the same road again. In the fu­ture, coun­tries will be se­verely chal­lenged by tech­nol­ogy and the in­ter­net. Non-state ac­tors will shock the ex­is­tence of coun­tries. Go­ing be­yond re­al­is­tic po­lit­i­cal logic, China will not be the main ri­val of US. Not even one coun­try will be US' ri­val. In­stead, US' main ri­vals will be non-state pow­ers such as transna­tional com­pa­nies, in­ter­net, ar­ti­fi­cial in­tel­li­gence ro­bot, ter­ror­ism and its var­i­ous do­mes­tic con­tra­dic­tions. One who can deal with all th­ese com­pli­cated prob­lems will be the leader of the fu­ture. Lead­ers of the fu­ture will not nec­es­sar­ily be state lead­ers. They could be philoso­phers or CEOs of transna­tional com­pa­nies. Noth­ing will be im­pos­si­ble.

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