China-US Trade Tensions: Yale economist: Beijing has emerged as Washington's favorite scapegoat

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Europe

03:29

A senior fellow from Yale University, on the east coast of the US, believes China has become Washington's favorite scapegoat. And in an interview with our reporter Wang Guan, he spoke about the pitfalls of the current US-China economic relationship, and explained why America's accusations against China's trade practices were unfair.

Stephen Roach is senior fellow at the Jackson Institute for Global Affairs and School of Management at Yale University. He is also a former chairman of Morgan Stanley Asia, and was once the firm's chief economist. In his book "Unbalanced: The Codependency of America and China", he explains the root cause of Washington's trade deficit with Beijing.

WANG GUAN NEW YORK "In your book, you argued that the low-savings culture, the 'enjoy now, pay later' lifestyle really contribute to the US trade deficit with China. Can you elaborate that?"

Roach also told Wang Guan that when he worked at Morgan Stanley, they formed a partnership with a Chinese company to build the country's first investment bank.

It was a joint venture, he said, that they both entered into "willfully" and "voluntarily". So when the Trump administration cited "intellectual property theft" and "forced technology transfers" as being threats to national security and, as such, grounds to launch a trade war, Roach recalled the experience and said "there was nothing forced about it".