Todd Bishop
US Commerce Secretary Wilbur Ross announced on August 19 that the US government’s trading restrictions on US companies and Huawei companies will be postponed for another 90 days. At the same time, however, the United States has added 46 new companies related to Huawei on the “entity list”. After 90 days, if the US government does not postpone the extension, US companies will be limited when they interact with these companies on the “entity list”.
Since China and the United States began to impose tariffs on the other goods for the first time in July 2018, the trade war between China and the United States has been fighting for more than a year. During the period led by Chinese Vice Premier Liu He and Director of the US Trade Representative Office, Robert Lighthizer, the two countries talked about the 12th issue. The two heads of state also borrowed the annual G20 summit in Buenos Aires during this period. Sri Lanka and Osaka met twice. As for the results, all parties have witnessed it.
Compared with the slower conflict between the two countries after the G20 summit in Argentina at the end of November last year, the consensus reached at the G20 summit in Japan at the end of July this year was quickly overturned: the United States intends to impose additional tariffs on 300 billion Chinese goods; Although Huawei’s business with US partner companies has been extended for exemption, it has not been officially lifted and has been restricted. China has therefore not resumed procurement of US agricultural products.
In fact, the exchanges between China and the United States in the past two months can be described as the epitome of Sino-US trade negotiations in the past year: China’s position has always been “talking, opening the door; playing, always accompanying it”; the attitude of the United States is easing and tough. swing. And when we look at tariffs and Huawei, whether it is exchange rate, finance, Hong Kong or even arms sales to Taiwan, China and the United States are clearly in a more confrontational situation.
The reason why Washington has this swing is that the reason why the contradiction between China and the United States is difficult to understand is naturally due to the structural challenges brought about by the combination of Sino-US comprehensive strength. However, in this macro context, the “Agreement” has never been It is not the common goal of Washington.
Over the past year or so, the US discussion on the trade war between the two countries has been “the trade relationship between the two countries is unfair, so it is trying to change the current trade structure between the two countries through negotiations.” According to this logic, the US operation in terms of tariffs and Huawei should have been just a “tool” for Washington to promote negotiations between the two countries.
However, for those who are now formulating US policy toward China, perhaps “agreement” is not originally its original purpose.
Looking back on 2018, there are many disputes in the US political arena, but the anti-China anti-China stance is supported by many cross-sectors such as the Democratic Republican Party, global supporters and populists, business and trade unions. In this process, the so-called “decoupling” or “disengagement” initiatives have become more and more discussed. That is, China and the United States go all the way, do not need so much bilateral trade, and block each other’s investment. , reduce the degree of dependence on each other.
However, it is easy to issue such an initiative, but it is difficult to implement it. Sino-US trade exchanges benefit each other. The rise of China’s economy is good for the United States, and the US economic recovery is also beneficial to China. After experiencing the process of “unrelated” to “interdependence”, and then want to return to the degree of mutual dependence, it will cost a lot.
To put it simply, if the trade between the two countries is indeed drastically reduced, the demand for the US dollar and US Treasury bonds will also be greatly reduced. By then, not to mention where the United States will look for alternative production sites for consumer products, there is no need to calculate the cost. Going to the dollar and the US debt is enough to set off a considerable political turmoil in the United States.
The harm of decoupling is so, what about its benefits? Why, such as the White House Trade and Manufacturing Policy Office Director, Peter Navarro, and others will repeatedly sell Trump to the US-China Decoupling? There are two points: one, to reduce the influence of pro-China lobbying organizations on American politics; and the other, to use US political, economic, and public opinion capabilities to isolate China, reduce China’s development space in the global economy, and ensure that the US comparative advantage is not challenged. .
Looking at a series of trade behaviors of the US government against the Chinese government, on the one hand, trying to isolate China, on the other hand, in order to achieve the effect of “decoupling”, and thus put forward excessive requirements that are not in line with reality, “you can ask for “the United States wins.” “The comprehensive agreement, the retreat can be decoupled from China and the United States.”
Under such circumstances, if the trade war continues, is there a possibility of decoupling? Obviously there are some, but it requires a great deal of cost from both countries and countries. In this regard, China has sufficient system to support it. Does the United States have it? This is generally doubtful. Trump understands the truth. The long-term strategy of containing China does not have much benefit for him. On the other hand, short-term interests are more in line with his demand for election politics. This also makes him the “biggest dove of China” in the White House.
However, if the “decoupling” in 2018 is still only an initiative, then as the trade negotiations between the two countries become more and more blocked and begin to spread to various fields, some of the White House aides will hold the “Anything to Win”. With a comprehensive agreement and a retreat that can be decoupled from China and the United States, this is becoming a potential prospect that needs to be taken seriously.
