Economic diplomacy: Charting the course for China-U.S. relationship

Editor's Note: Navigating the complex currents of global economics, the relationship between China and the United States emerges as a cornerstone, influencing the trajectory of international trade and diplomacy. In this video and article, we delve into the intricacies of this vital relationship, drawing on insights from experts. The views expressed in the video belong to the experts interviewed and featured and do not necessarily reflect those of CGTN.

In the ever-evolving landscape of global commerce, few relationships carry as much weight as that between China and the United States. Despite apparent economic tensions between the two countries, stemming primarily from Washington's polarized politics and its policy of treating China as a rival, recent diplomatic efforts signify an ongoing commitment to keeping channels of communication open.

"The Americans have woken up and realized that China is a great power, which was inevitable - if China was successful economically, it would become a great power. And they find this very, very difficult to handle," remarked Martin Wolf, Chief Economics Commentator at the Financial Times, at a roundtable organized by the Beijing-based Center for China and Globalization (CCG) in the Chinese capital last month.

"The bottom line is we should take politics out of commerce... If there's a national security issue, let's deal with that. If there's no national security issue, let's leave it at that," emphasized Eric Zheng, President of AmCham Shanghai, speaking exclusively with CGTN. "If it's a commercial issue then let the market decide," he added.

The recent visit of an American business delegation to China, led by Suzanne Clark, President and CEO of the influential U.S. Chamber of Commerce, underscored the importance of maintaining dialogue and pursuing economic diplomacy. Clark's meetings with top Chinese officials, including Premier Li Qiang, emphasized the "extremely important" nature of China-U.S. relations.

"I think all of us want an outcome where the world's two largest economies can coexist in a way that isn't defined by zero-sum metrics," Clark had earlier said. "We want to create a framework...where we can compete on a level playing field, confront challenges in the relationship, and cooperate on big global priorities."

Clark's visit was welcomed by the American business community in China. "It's good to have somebody like Ms. Clark visiting China so that she could demonstrate to the audience back home in the U.S. that engagement (and) commercial relationship with China is important," Zheng stressed.

Despite the apparent China-U.S. tensions, a large number of American companies remain upbeat on China as a business and investment destination, as revealed in the latest report by the American Chamber of Commerce in China (AmCham China) released last month. Another report by AmCham South China found that 90 percent of American companies have achieved profitability in China, reflecting a high return on investment (ROI).

"We represent U.S. companies in China, so we certainly see the commercial benefits from that angle," Zheng noted. "When you talk about manufacturing, and certainly China has become a major manufacturing base exporting affordable products to the U.S. So, from a manufacturing standpoint, global supply chain standpoint, these two countries have benefited from this relationship. And from a consumption standpoint, certainly China is a huge market, not only for China itself but also for foreign companies," he elaborated.

However, despite striking a positive chord in Beijing and recognizing the significance of China-U.S. economic relations, Clark's own views continue to defend American protectionism, as gauged from her remarks at the 13th annual China Business Conference in Washington D.C. last year.

"The U.S. Chamber supports targeted and responsible steps to restrict Chinese access to sensitive technologies that could be used to undermine America's national security, including export controls, technology restrictions, and scrutiny of outbound investment," Clark said at the conference, however clarifying that "not every economic interaction with China poses a national security risk" and that "there is still a vast area of commercial opportunity where the two countries can and should engage productively."

This sentiment is mirrored in the Biden administration's strategy of "decoupling" or adopting a "small yard, high fence" approach that seeks to restrict economic engagement with China, particularly in high-tech sectors like artificial intelligence (AI) and semiconductor development. Premier Li Qiang pointed out the detrimental effects of this approach to the visiting American business delegation led by Clark.

Wolf offers a slightly different perspective. "When [U.S. National Security Advisor] Jake Sullivan says, 'We are trying to build a high fence but with a small yard,' I think he means it… They don't want open-ended conflict with China. They want a deal which narrows things… they want trade to continue and they want to be able to do deals with China on very important joint interests like climate which this administration believes in and other things."

The American business community in China recognizes the importance of maintaining robust economic relations between the two countries. "Decoupling is not a feasible option given the extensive commercial and cultural integration between the U.S. and China over the past four decades. Finding ways to work together remains in the best interests of both countries," concluded Zheng.

Despite the complexities and challenges, the economic relationship between China and the U.S. remains indispensable on the global stage. As we navigate through this intricate landscape, it's evident that constructive dialogue and cooperation are vital for both nations. While tensions may persist, the mutual benefits of collaboration far outweigh the alternatives, reinforcing the necessity of economic diplomacy in charting the course for China-U.S. relations.

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