US President Donald Trump’s intensifying trade conflict with China is reckless and unfortunate, as it could hugely harm not only the world’s two biggest economies but also others. Yet China – or perhaps, more precisely, its “core” leader Xi Jinping – is also culpable for the current stalemate.
In an opinion piece in USA Today on July 19, Chinese Ambassador to the United States Cui Tiankai said the US president’s trade war against China “is unjustified and unfair.” He strongly rebutted the Trump administration’s three main arguments against China on trade – namely America’s large trade deficit with China, Beijing’s intellectual-property (IP) theft and its forced technology transfer.
While the manner and the extent of his confrontation with China on trade are contentious and injudicious, Trump is right, at least, on the last two issues. In fact, as already noted, his concerns about Beijing’s IP abuses and forced technology transfer practices are shared by many in his country and in Europe.
In any case, whether it is justified or not, it is obvious that Trump’s current – or the first stage of – trade war against China is more about technology than trade, and this is mainly fueled by fears that the Asian giant will overtake the US in the technology field.
In his June 15 announcement about the United States’ first tranche of tariffs on Chinese exports, which came into effect on July 6, the American leader accused China of long “engaging in several unfair practices related to the acquisition of American intellectual property and technology.”
In light of such abuses, he announced that his country would implement a 25% tariff on US$50 billion worth of goods from China “that contain industrially significant technologies to dominate the emerging high-technology industries that will drive future economic growth for China, but hurt economic growth for the [US] and many other countries.”
More precisely, Trump specified that the levies targeted “goods related to China’s Made in China 2025 strategic plan to dominate the emerging high-technology industries.”
An investigation by the Office of the US Trade Representative (USTR) found that “China’s acts, policies and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory, and burden US commerce” and singled out Made in China as a prime example. By some calculations, the USTR’s 215-page report published in March referred to China’s flagship scheme 116 times.
Unveiled in 2015, the state-run initiative is aimed at boosting Chinese companies, enabling them to dominate the domestic market and compete globally in 10 key areas, including aerospace and industrial robots.
In a major address on May 29, President Xi strongly pushed ahead with the strategy. With the ambition to transform “China into a world science and technology leader,” he reportedly called for “concerted endeavors and strategic arrangements in key cutting-edge technologies and in fields subject to other countries’ control to achieve innovative breakthroughs.”
But Beijing’s overtly ambitious plan and, especially, its forceful way of achieving it, including allegedly forcing foreign and American companies to transfer technology, has stoked anger and fear in the US.
Apparently, the Chinese leader’s remarks on May 29 intensified such anger and fear in Washington. Late on the same day, the White House announced that the US “will impose a 25% tariff on $50 billion of goods imported from China containing industrially significant technology, including those related to the ‘Made in China 2025’ program.” It also gave notice that “the final list of covered imports will be announced by June 15, 2018, and tariffs will be imposed on those imports shortly thereafter.” All of these happened as they had been announced.
Probably, it is not merely Beijing’s “Made in China 2025” but Xi’s overall domestic and foreign policies since coming to power in 2012 and, notably, since his extraordinary consolidation of power at the ruling Communist Party of China’s National Congress last October and the National People’s Congress (NPC) this March that have made the US more wary of – and forcefully reactive to – Beijing’s intentions and ambitions.
Instead of following the “hide your strength and bide your time” advice of Deng Xiaoping, China’s former paramount leader, in both rhetoric and policy, Xi flashed his country’s new-found power and strongly stirred up national pride and rejuvenation.
For instance, in his marathon address to the CPC’s five-yearly conclave, he assertively and solemnly declared that China, “with an entirely new posture, now stands tall and firm in the East” and, consequently, urged it to “take center stage” in the world.
In the three-and-a-half-hour speech, Xi also said that by 2035, China would “become a global leader in innovation” and “a global leader in terms of composite national strength and international influence” by 2050. Implicitly, he set out new visions or ambitions for his country to overtake the US economically by 2035 and in all key areas, including military, by the middle of the century.
Under Xi’s watch, China has, among other ambitious intentions and contentious actions, massively modernized its army and aggressively built and militarized artificial islands in the disputed South China Sea.
Obviously, his muscular policies and, notably, nationalist addresses were mainly aimed at domestic audiences, especially those within the party and society concerned about his power grab and tightening grip on power. But they couldn’t go unnoticed abroad.
It could be said that Xi’s ambitions and actions are the main reasons his China was painted adversely by the Trump administration’s three key security-related documents – namely National Security Strategy, National Defense Strategy and Nuclear Posture Review (NPR). In the first two strategies, the People’s Republic was put first among the top four security challenges facing the US. The other three are Russia, two “rogue states” (North Korea and Iran), and terrorist groups. In the NPR, China was placed second, after Russia.
Judging by some of its latest moves, it seems that the Chinese government has now realized that its – or more correctly, Xi’s – overtly forceful posture is strategically ill-advised
Judging by some of its latest moves, it seems that the Chinese government has now realized that its – or more correctly, Xi’s – overtly forceful posture is strategically ill-advised. For example, the Chinese government has played down the once-much-hyped Made in China policy. According to a Reuters report on June 25, state news agency Xinhua made more than 140 mentions of the policy in Chinese-language news items in the first five months of 2018, but hasn’t mentioned it since June 5.
On June 24, the Global Times, an offspring of the People’s Daily, even urged the country “to stay modest” as, though China has “made rapid progress” in technological development, there is still “a huge gap between China and the US, which requires generations of arduous efforts to overcome.” More remarkably, the nationalistic and influential outlet observed, “voices that China will surpass the West and eventually pose a subversive threat are frequently heard] in the US and European countries and this “means the sense of crisis is stimulating and motivating society” in those countries.
Early this month the People’s Daily condemned “repeated boastfulness and arrogance,” attacking online articles that exaggerated China’s achievements. However, as rightly noted, the CPC’s mouthpiece failed to acknowledge that encouragement to do so had long come from the very top.
Indeed, in both his addresses to the CPC’s congress and the NPC closing meeting, Xi boasted about the “tremendous transformation of the Chinese nation,” which “has stood up, grown rich, and is becoming strong!” Amazing China, a 90-minute propagandist documentary film by state broadcaster China Central Television, was all about China’s huge accomplishments in many areas, including science and technology, since Xi assumed power in 2012.
It is speculated that there are now discontent and dissent within the CPC’s hierarchy and among Chinese society about Xi’s posture, policy and handling of the current trade disputes with the US.
Such dissatisfaction and opposition are possible, and would be understandable. While Trump’s burgeoning trade conflict with China is not all Xi’s fault, the Chinese leader shares a large part of the blame for it. Had he followed Deng Xiaoping’s “bide and hide” advice, he probably wouldn’t have generated so much alarm and, consequently, tough posture from Trump’s America.
In a very insightful piece in the Financial Times on July 25, Mark Leonard, director of the European Council on Foreign Relations, said many of the Chinese officials and intellectuals he had spoken to during his recent visit to Beijing “are awed by [Trump’s] skill as a strategist and tactician.”
They also “feel that Mr Xi has over-reached and worry that it was a mistake simultaneously to antagonize the US economically and militarily in the South China Sea.” For that reason, he said, “they advocate economic concessions and a pullback from the aggressive tactics that have characterized China’s recent foreign policy.”
If these are truly the generally held views of the Chinese elite, which is likely the case, Xi’s reputation has already been significantly damaged.
Beijing’s – or Xi’s – propaganda machines have obsequiously depicted him as “a world leader” who has “facilitated the solution to many global problems,” an all-powerful man “who makes things happen” or “an extraordinary leader” whose “super-strong leadership” has gained “international praise.”
Apparently, Xi isn’t such a leader. If he were, he could have prevented or resolved his country’s escalating and damaging trade war with Trump’s America.
I was shocked by the tact that President Xi took when confronting——Donald John Trump the 45th President of the United States——-what a blunder———instead of doing the Ali rope–a–dope Xi went all in with a aggressive posture———-he definitively was not following the wisdom of Sun Tzu (544BC-496BC) the military genius that Xi said he greatly admired. What has sunk Xi is he thought all US Presidents were dummies and fools——–#41,#42,#43,#44, were and also sell outs BUT Donald John Trump is not like them and Xi mis-calculated due to arrogance and advisors that are just YES men.
LoL, you’re as ignorant as the author of this article – completely blind to the reality that america won’t won trade war against China. Only idiots will stay meek when being screwed by rogue states such as us regime. China has bide her time well and carefully select the right time against america.
The lies and stupidity in this article are unbelievable.
Only a dumb strategist will believe US will win this trade war. The US have not learnt any lessons about other cultures.They could not muscle a small,poor communist North Korea but believe they could defeat a rich communist China. What US calls war,China calls struggle. US will climb down in 2 years or less and that begins the unraveling of US global leadership. This trade ‘war’ that started innocuously will determine where the global economic rests. Fasten your seat belt.
Mr Abbas your forefathers were not muslims….everyone knows this….so you should not claim yourself as a muslim….so pl don’t go back to past….
How foolish!! Till the day of ‘Qayaamat’…..haa! haa! haa!
How can it be called forced technology transfer when the foreign party can choose to enter China or not? It’s not forced when the foreign party has a choice.
With people like you around its No wonder your nation has become a joke and your Orange orangutang Buffoon president is sinking your joke of a country deeper and deeper into the quagmire set up by ancient civilisations like China, Iran, Pakistan, Russia and now increasingly Turkey…….it wont be long no when you will be relegated to the dustbin of history, here is a quote by the wise Sun Tzu “Pretend inferiority and encourage your enemies arrogance” you seem to be the classical idiot this quote addresses. Orange Buffoons land is history, Bye Bye criminal murderers and resource thieves, the world hates your evil nation.
Sami Ahmed Well said comrade, China has inferiorty due to our smaller weapons
We should never allow Chinee to live overseas, they might come into contact with other ideas.
Yes, we must only believe what the CPC tell us.
Worse than the CPC ?
And the CPC only publish the truth ?
Pakistan, an ancient civilization ?
This foolish reporter has not reported the full facts of this case. Stupid journalism !
How about the chinese control media ? At least in US and other western countries there is a freedom of the press to verify the truth. . .
This author is totally ignorant and doesn’t know what he is talking about. Where did he get his PhD again? : x
Devadasan Pn Yes I do belive so, but you being a jelous hindu slum dweller, will always be burning in hate when Pakistans name comes up………here is some information for a hindutva fundamentalist like you.
The Harappan Civilization has its earliest roots in cultures such as that of Mehrgarh, approximately 6000 BC. The two greatest cities, Mohenjo-daro and Harappa, emerged circa 2600 BC along the Indus River valley in Punjab and Sindh-Pakistan
The civilization, possessed earliest writing system, urban centers, and diversified social and economic system, was rediscovered in the 1920s also after excavations at Mohenjo-daro in Sindh near Larkana, and Harappa, in west Punjab south of Lahore.
Sami Ahmed bravo ????????
The proof of the pudding is the eating as my late mother used to remind me! The Chinese stock market is in a bear market——–President Xi really made a mess of this trade problem——–the King and the dopey YES men around him thought Donald John Trump was a paper tiger——-yes the last two losers (Barack Hussein Obama and George Walker Bush were and Xi did not even respect these two FOOLS) bent to the will of the Chinese and never thought are cared about there consequences.Go forward one and half years later and the Chinese leadership totally misjudged the metal of Donald John Trump and now the NEW TRADE deal that will be made will only make Trump look larger in the eyes of his 63 million supporters and growing——and also in the eyes of the international public. Go ahead and diss me ——-you think I care——–life is about leverage BUT some of the dummies that post articles attacking Donald John Trump on Asia Times never been in business and don’t understand leverage and its charm and power. See all you Trump haters on the other side ——–the side of victory for America——— after 30 years of giving the store away and the prior four United Sates Presidents that are a DISGRACE!!!
Khizar Farooq cheers brother
Sami Ahmed I don’t understand what makes Hindus slum dwellors? Nor does the harrapan civilization being placed in Pakistani territory make Pakistan an ancient civilization. The harrapan were hindus, according to you that would make them slum dwellors, now in retrospect according to you as they and you were in the same dynasty, you are a derivation from slum dwellors, in hindsight according to you that would make you and I on the same side, as we are too their decendents.
Although with your brash argument I understand you have a rudamentary understanding of history stemming from wikipiwik at best. So let me just tell you this, you are Afghan decendents not harrapan. You didn’t even exist when the harrapan were here. You came into India and slaughtered our culture and placed a regressive ghoulish one in place, based on religious intolerance, an oppressive regime and so much more. I’m not saying that the mughals didn’t have their plus points but just like the British you were war mongerers but without their finesse, unwanted.
America has a choice on what to buy, it’s their country, their money, I don’t understand why china is so mad about it? A question like that can only have an answer like this ???? also China doesn’t need to sell here they can sell elsewhere.
Laws in china change rapidly, the laws which were there in the 2000’s aren’t remotely even the same as now in this field, and by this time a lot of companies are invested into China, relocation will cost them too much, this is how China is applying indirect force. So it just seems like they have a choice.
Second you can’t just ignore a market of over 1.5 billion people.
Third this doesn’t answer your question but I want to say it anyways, by not having the same laws apply to Chinese companies in the US as US companies have in China you have a unfair competitive edge and are in a way stealing from them. Fun fact US patents aren’t recognised in china, so a Chinese man can go and buy the journal of science copy someone’s work and claim it as his own, plus it’s in chinsese, which is even better, google trnslate yourself to free money, the irony is that even that’s Western.
Four the world revolves around trading how is not getting into a market a choice? China has forced companies to do 70% of the r& d in china, it controls major bussinesses in which it’s a requirement to share sensitive info. The information at stake here is tech which will make or break the western world of course China has a trade war on the rise, this should have happened 4 years ago.
So basically companies can’t leave they can’t stay.
Also this isn’t even the point uder WTO china has to provide an open market with protection of each companies intellectual rights.