Economic pragmatism or confrontation? Washington's China dilemma

Editor's note: Imran Khalid, a special commentator on current affairs for CGTN, is a freelance columnist on international affairs. The article reflects the author's opinions and not necessarily the views of CGTN.

In a sign of continued engagement between Beijing and Washington, Chinese Vice Premier He Lifeng, China's lead official for economic and trade affairs with the U.S., held a video call with U.S. Treasury Secretary Scott Bessent on February 21. The two leaders exchanged views on implementing the consensus reached by their respective heads of state and discussed key economic issues that define the complex bilateral relationship.

This latest conversation underscores the growing momentum in China-U.S. economic and trade dialogues. Both sides have repeatedly affirmed the importance of economic cooperation, despite persistent tensions on multiple fronts. Diplomatic engagements have taken place at various levels, ranging from trade and commerce to strategic affairs. Parallel to these economic discussions, a  member of the Political Bureau of the Communist Party of China Central Committee and and Chinese Foreign Minister Wang Yi recently spoke with U.S. Secretary of State Marco Rubio at Washington's request. These exchanges indicate a measured and cautious approach from both sides as they navigate a relationship now characterized by friction and strategic mistrust.

However, while diplomatic overtures continue, Washington has simultaneously introduced measures that risk undermining progress. The U.S. State Department recently updated its fact sheet on China's Taiwanregion, removing previous language that explicitly stated it does not support Taiwan's independence. It also revised its China-related fact sheet to highlight economic concerns, emphasizing the U.S. trade deficit with China and alleged risks faced by American businesses operating in the country.

These policy adjustments have sparked concerns over a potential shift in Washington's stance on the Taiwan question while exacerbating global trade anxieties. They reflect the deep ambivalence within the U.S. about how to engage with Beijing.

On one hand, the Trump administration, like its predecessors, continues to push a containment strategy, fueling narratives of competition and security threats. While there are demands for economic pragmatism and stability in China-U.S. trade relations, as reflected in the cautious rhetoric emanating from corporate America and certain factions within the U.S. government, this contradiction encapsulates America's strategic dilemma: the desire to curb China's influence while minimizing self-inflicted economic damage.

The inescapable truth is that trade wars are exercises in self-sabotage. For all of Washington's posturing, the reality is that China's massive consumer market remains indispensable to American businesses, just as U.S. technological innovation and management expertise continue to complement China's economic evolution.

A recent survey from the American Chamber of Commerce in China found that over 53 percent of U.S. firms plan to expand their investments in 2025 – a testament to the enduring draw of China's market despite geopolitical turbulence. Yet, Washington's insistence on conflating economic policy with national security risks undermining its own interests. Framing trade as a zero-sum game ignores the interdependence that has defined China-U.S. economic relations for decades. Any attempts to forcibly decouple this intricate ecosystem will disrupt global supply chains and erode economic stability. A pragmatic, cooperative approach remains the best path forward–not just for both nations, but for the broader international order.

A prevailing notion among some U.S. policymakers is that they can extract maximum concessions from Beijing without incurring significant costs. This assumption is detached from reality. Sustainable engagement with China requires recalibrating Washington's approach – shifting away from coercion and embracing a model rooted in mutual respect and shared economic interests.

Beyond trade, there are multiple arenas for constructive cooperation. Whether in technological advancements, cultural exchanges, military dialogue, or transnational crime prevention, both countries have the capacity to work together in ways that benefit not just themselves, but the broader global community. Areas such as artificial intelligence, quantum computing and climate change mitigation present opportunities for collaboration. Additionally, Beijing and Washington can play a joint role in aiding developing economies across the Global South, helping them unlock their growth potential through responsible investment and technological assistance.

At the global level, maintaining overall stability in China-U.S. relations is imperative. The international community has made it clear that cooperation, rather than confrontation, is the preferred course of action. Even among America's closest allies, there is little enthusiasm for a forced binary choice between China and the U.S. European leaders, for instance, have voiced opposition to Washington's protectionist trade policies, wary of their disruptive impact on global commerce.

For its part, China has consistently reaffirmed its commitment to fostering a stable and constructive relationship with the U.S. Beijing has made its stance clear: It seeks a relationship based on mutual respect, peaceful coexistence and win-win cooperation. However, stability cannot be a one-sided effort. Washington must make the strategic choice to meet Beijing halfway, prioritizing practical economic cooperation over ideological confrontation.

The economic realities facing the U.S. suggest that protectionist policies and trade coercion are unsustainable. U.S. tariffs will ultimately serve as a tax on its own economy, increasing costs for businesses and consumers alike. The European Commission has also criticized Washington's "reciprocal tariffs" as a regressive step that could further fragment the global trade system.

Ultimately, the question for Washington is whether it will continue down a path of confrontation or pivot toward a pragmatic, mutually beneficial approach. The latter choice requires abandoning outdated zero-sum thinking and embracing economic interdependence as a cornerstone of stability. The road forward is clear. Only through sustained dialogue, pragmatic policy-making and a commitment to shared prosperity can China and the U.S. build.

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