The Dragon visits the land of Uncle Sam

By Yiming Yu, a Shanghai native currently studying International Relations at King’s College London. 
Obama v Xi

When President Xi Jinping cited Sleepless in Seattle and The Old Man and the Sea in his inaugural visit to the United States, the kindness he portrayed attempted to wash over increasing hostilities in Sino-US relationship. Though Xi and Obama tried to create a façade of genuine friendship, the visit by the premier continues his predecessors’ concentration on the economy with little progress made in other areas. With solutions to issues such as cyber security and the South China Sea disputes yet to be found, along with US contempt for Xi’s authoritarian control over China there are question marks over whether these two super powers can live in harmony.

The economy appears to be the area where the most common ground can be found, something to be expected given the importance of these connections in the bilateral relationship. Indeed, just last year China’s trade with the US was almost 600 billion dollars1. Xi’s choice of Seattle rather than Washington as his first stop in the US demonstrates that he continue his predecessors’ focus on economic issues. However, this strategy may backfire for Xi as he must assure US entrepreneurs that the Chinese economy is suitable for investment and trade. The Chinese economy has been slowing down in recent months, and was confirmed by the decline of China on the official purchasing managers’ index (PMI) to a low of 49.82. To get an understanding of what this means a figure below 50 suggests that the manufacturing sector is contracting. While the government still maintain that they have met their growth rate target of 7%, this is doubted by many analysts who estimate that the figure is much lower3. Whether or not this statistic is correct, this is the slowest growing pace of the Chinese economy for over 25 years4. If Sino-US trade is indeed worth over 600 billion dollars to the two nations, Xi had to make sure that the Chinese economy is still an attractive option for American businesses which would strengthen the Chinese economy, and with it the ruling class who rely heavily on a strong economic performance.

There were other positive aspects to the trip with the most important being the climate change deal, where Xi announced that China would set up a cap-and-trade programme to control Carbon Dioxide emissions starting from 2017 and would allocate 3.1 billion dollars to help low-income countries6. In addition to this, the Chinese and the Americans showed that they have common interests in sectors including, but not limited to, nuclear programmes in Iran and North Korea, Afghanistan, peacekeeping and global sustainable development7 and 8. This shows China’s commitment to take the responsibilities of a great power and as David Shambaugh, a famous scholar on Chinese politics point out, this signals China’s willingness for more active cooperation with the US in global governance9.

However, despite many areas of progress, there is still no consensus on long-existing issues, issues that are crucial to the future dynamic of Sino-US relations such as cybersecurity and the South China Sea disputes. It must be noted that Obama clearly expressed dissatisfaction and concern over China’s cyber activities and showed contempt towards the construction of artificial airstrips in disputed territory while Xi denied and defended both of these activities as you would expect10. In the field of cybersecurity, there was little progress, though both parties nominally agreed to refrain from state-sponsored cyber theft for commercial gain. They also promised to establish a high-level dialogue mechanism between the two countries and to work on international rules of cyber conducts11 and 12. Nevertheless, it is noticed that the agreement left room for difference where Obama claimed stop of cyberespionage for commercial gains against companies while Xi only mentioned cybercrime13. Richard Bejtlich, a fellow at Brookings Institution, also points out that there are four ways to interpret this agreement, where China’s subsequent action may range anywhere from an authoritative robust policy restricting cyber theft on intellectual properties, to the continuation of hacking against US governmental departments as claimed by the US government recently14. At the same time as the visit, a high ranking Chinese official lambasted the US for a hypocritical cyber policy15 showing the conflict is not resolved yet, especially with rumours that the US could impose sanctions on China if the hacking continues. While it could be believed that China and the US have found some common ground on the cybersecurity issue, it seems that both sides refuse to compromise on disputes in South China Sea. Though both have signed the little-noticed Annex of the Rules of Behaviour for Air-to-Air Encounters to prevent potential collision and to show their determination to avoid conflicts16, there seemed to be no consensus in the joint press conference and more tension is expected to exist in South China Sea.
Following the end of the summit, there were questions raised as to whether this meeting was successful or not with conclusions ranging from success to failure to satisfactory. However, with so many uncertainties in the conflicted areas and even areas where progress has been made in the summit, it is safe to think it too early to conclude whether Xi’s visit was successful. After Xi took the throne, his assertiveness and revisionism satisfied the population’s ambition of ‘rejuvenation of the Chinese nation’. This fervent nationalism is precisely the thing that keeps the Chinese Communist party in power.

When Xi met with American business leaders in Seattle to promote trade and Chinese economy, it should not be overlooked that favourability towards the Chinese investment markets  in the American business circles is reducing, creating an environment where only 24% of business executives surveyed felt optimistic about doing business in China. Comparatively, 5 years ago this figure was nearer 67% 17. The change of attitude could be largely attributed to the Party’s enhanced national security policies, which include the requirement of passing critical data and intellectual properties on to the authority18. It is believed by the US Chamber of Commerce that these laws would bar American businesses from fair competition with Chinese counterparts19. Also, the Chinese government’s heavy but failed intervention to stimulate stock market in August left a bad impression on these business leaders tarnishing China’s reputation20. Similarly, it is reported that between one fifth and one third of Chinese CO2 emissions are produced by export industries21. Although China is advocating reform of industry structures, considering the economy’s great importance to the Party’s ruling as well as local government officers’ position, would China be willing to potentially sacrifice the growth rate of the economy to fight against climate change, especially in the time of economy slowing down?

The phrase a ‘new type of great-power relations’ may be one of the most frequently quoted words in the Chinese statement on the Sino-US relationship. Domestically, this sentiment could be regarded as the effort to acquire the population’s confidence and support towards the ruling party Party as it recognises the peasantries dream to be a great power. This could explain why some media outlets allege that China took symbolic gestures as China’s primary goal as it ensures Xi’s security and dignity22, which could prove to domestic audience that China is a respected great power. Interpretations of this phrase vary from equal treatment and win-win cooperation to respecting each other’s interests as great powers to US’ accommodation of China’s core interests23. How both sides perceive this description of bilateral relationship may greatly decide progress of diplomacy in the future while also produce many uncertainties.

After all, no one wants to see China and the US walk into the Thucydides Trap which is another phrase used by Xi to explain conflicts between a status quo power and a rising power. Some commentaries claim that the Sino-US relationship has reached a tipping point and could be seen to start a new Cold War. However, when Xi’s predecessors met with the US leaders, despite conflicts over some issues, the bilateral relationship kept progressing24. With the foundation of economic connections and both sides’ willingness to continue diplomatic dialogues, it could be believed that Xi would not be an exception and there will still be a relatively positive relationship between two states. Nevertheless, a new US president will take office next year, which will potentially change their foreign policies towards China. Furthermore, with the Chinese economy in turmoil it may be less alluring to US businesses and Xi’s effort to consolidate the Party’s rule may mean a more assertive foreign policy and more restrictions on foreign business’ activities in China. These factors are likely to lead to more uncertainties in the future. How both sides deal with these uncertainties will eventually shape the future of Sino-US relationship.

  1. “Collision course? Rise of China a stress for the US,” BBC, accessed October 2, 2015, http://www.bbc.co.uk/news/world-asia-china-34368249
  2. “Chinese manufacturing continues to contract in September,” BBC, accessed October 1, 2015, http://www.bbc.co.uk/news/business-34409196
  3. ibid
  4. ibid
  5. “Xi Jinping of China to Address Wary U.S. Business Leaders,” New York Times, accessed October 1, 2015, http://cn.nytimes.com/china/20150923/c23xijinping/en-us/
  6. “China takes a lead on global climate change,” Financial Times, accessed October 1, 2015, https://www.foreignaffairs.com/articles/china/2014-10-09/not-so-empty-talk
  7. “Collision course? Rise of China a stress for the US,” BBC, accessed October 2, 2015, http://www.bbc.co.uk/news/world-asia-china-34368249
  8. “FACT SHEET: President Xi Jinping’s State Visit to the United States,” The White House, accessed October 5, 2015, https://www.whitehouse.gov/the-press-office/2015/09/25/fact-sheet-president-xi-jinpings-state-visit-united-states
  9. “Reserving differences while finding common ground,” New York Times, accessed October 3, 2015, http://www.brookings.edu/research/opinions/2015/09/28-xi-us-visit-common-ground-shambaugh
  10. “Obama and Xi Jinping of China Agree to Steps on Cybertheft,” New York Times, accessed October 5, 2015, http://cn.nytimes.com/china/20150926/c26prexy/en-us/
  11. “Collision course? Rise of China a stress for the US,” BBC, accessed October 2, 2015, http://www.bbc.co.uk/news/world-asia-china-34368249
  12. “FACT SHEET: President Xi Jinping’s State Visit to the United States,” The White House, accessed October 5, 2015, https://www.whitehouse.gov/the-press-office/2015/09/25/fact-sheet-president-xi-jinpings-state-visit-united-states
  13. “Obama and Xi Jinping of China Agree to Steps on Cybertheft,” New York Times, accessed October 5, 2015, http://cn.nytimes.com/china/20150926/c26prexy/en-us/
  14. “To hack, or not to hack?,” Brookings Institution, accessed October 3, 2015, http://www.brookings.edu/blogs/up-front/posts/2015/09/28-us-china-hacking-agreement-bejtlich
  15. “Chinese Official Faults US Internet Security Policy,” New York Times, accessed October 2, 2015, http://www.nytimes.com/2015/09/30/technology/chinese-official-faults-us-internet-security-policy.html?_r=0
  16. “Obama-Xi summit produces landmark deal to reduce dangerous military encounters,” The Interpreter, accessed October 5, 2015, http://www.lowyinterpreter.org/post/2015/09/29/Obama-Xi-summit-produces-landmark-deal-to-reduce-dangerous-military-encounters.aspx
  17. “Xi Jinping of China to Address Wary U.S. Business Leaders,” New York Times, accessed October 1, 2015, http://cn.nytimes.com/china/20150923/c23xijinping/en-us/
  18. ibid
  19. ibid
  20. “A very long engagement,” The Economist, accessed October 4, 2015, http://www.economist.com/news/china/21665034-xi-jinpings-state-visit-washington-will-do-little-resolve-growing-tensions-very-long
  21. “China’s Exports Are Closely Linked to Its Emissions,” New York Times, accessed October 1, 2015, http://sinosphere.blogs.nytimes.com/2015/10/01/chinas-exports-are-closely-linked-to-its-emissions/?module=BlogPost-Title&version=Blog%20Main&contentCollection=World&action=Click&pgtype=Blogs&region=Body
  22. “Watching the signs: Can honesty and candour define Xi Jinping’s first state visit to the US?,” Financial Times, accessed October 4, 2015, http://www.scmp.com/comment/insight-opinion/article/1860413/watching-signs-can-honesty-and-candour-define-xi-jinpings
  23. “Not-So-Empty Talk,” Foreign Affairs, accessed October 3, 2015, https://www.foreignaffairs.com/articles/china/2014-10-09/not-so-empty-talk
  24. “Chinese state visits are always hard: A historical perspective,” Brookings Institution, accessed October 4, 2015, http://www.brookings.edu/blogs/order-from-chaos/posts/2015/09/17-xi-jinping-state-visit-politics-bader
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