Editor's note: Liu Chunsheng, a special commentator on current affairs for CGTN, is an associate professor at the Central University of Finance and Economics in Beijing. The article reflects the author's opinion, and not necessarily the views of CGTN.

The tensions between China and the United States have become increasingly complex, drawing global attention. In an effort to ease the conflicts and deepen their relationship, China and the U.S. launched a pair of working groups which will be divided into economic and financial segments.

The new working groups are not that new. In 2006, China and the U.S. initiated the Strategic Economic Dialogue (SED). The primary aim of the SED was to address trade imbalances and economic issues through high-level discussions and negotiations, promoting economic cooperation between the two nations. This dialogue mechanism encompassed multiple working groups, covering areas of finance, trade, energy, and environment. Within the framework of the SED, China and the United States engaged in substantive negotiations on a range of critical issues, occasionally achieving significant progress.

In 2017, with the advent of the Donald Trump administration, the SED was replaced by the Comprehensive Economic Dialogue (CED), which sought to address trade imbalances and other disputes. However, the bilateral economic relations became increasingly tense after Trump took office, so both sides found it difficult to reach a substantive consensus through the CED. Instead, the U.S. announced tariffs against Chinese products, sparking a highly publicized trade war.

The cessation of economic dialogues can be attributed to several complex factors, including political, trade, and diplomatic issues. Regarding trade disputes, the U.S. government took a series of unilateral actions, including restricting the export of high-tech products, especially semiconductors to China, and arbitrarily placing Chinese companies, research institutions, and universities on so-called entity lists. This heightened the fact that trade tension had a negative impact on economic dialogues, as it became challenging to reach agreements in such a tense atmosphere.

Political and diplomatic disputes between China and the United States also added complexity to the economic dialogues. Issues such as the Taiwan question and the South China Sea disputes negatively affected bilateral relations.

The original purpose of the economic dialogues was to address economic issues and promote bilateral cooperation. However, on some key issues, substantial progress was not achieved. For instance, there were significant differences on matters related to market access, intellectual property protection, and technology transfer, leading to a stalemate in negotiations.

The economic ties between the two nations are not weakening but the dialogue mechanism has stopped. To prevent China-U.S. relations from slipping into a cold war which both sides cannot afford at present, the revival of communication mechanism has become necessary.

In the past few months, U.S. high-level officials have made intensive visits to China. From July 6 to 9, U.S. Treasury Secretary Janet Yellen visited China. From August 27 to 30, U.S. Secretary of Commerce Gina Raimondo also came to China for an official visit. Their trips to China in succession at least reflected the willingness of the American business community to increase their exports and investment in China, recognizing that the two economies are highly complementary. 

In the current context of increasingly complex China-U.S. economic and trade relations, the establishment of these two working groups holds significant meaning and value. China and the U.S. share a tightly interconnected economic relationship, from which both countries benefit. Both sides have the motivation to seek common ground on economic issues to safeguard their respective interests.

China and the U.S. are the world's two largest economies, so their trade and investment ties are crucial for global economic stability. By negotiation rather than confrontation, they can enhance coordination in policy decision-making on some major issues through face-to-face communication, which contributes to the global economic recovery. Moreover, global challenges like climate change, public health crises, and global financial stability require cooperation between China and the U.S.

Regarding the prospects of the economic groups, a cautiously optimistic attitude is warranted. Despite numerous challenges, the economic interconnectedness and cooperation potential between China and the United States remain substantial. To address economic imbalances, technological issues, and global challenges, both sides should continue to adhere to a cautiously optimistic viewpoint and work together constructively to foster mutual understanding, resolve disputes, and contribute to the global economy and society. Only through open and constructive dialogue can a win-win situation be achieved.

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