Home > Finance > View: With Donald Trump gone, Beijing can relax a bit. ​​But can it really?

View: With Donald Trump gone, Beijing can relax a bit. ​​But can it really?


The US election verdict has provided Chinese President Xi Jinping with a unique gift. Though Donald Trump has been the butt of jokes and anger in China’s social media for the past few years, his accusations may have affected the Communist Party of China’s (CPC) perception among the growing class of English-speaking Chinese youth. There have been questions about whether the trade war, which severely hurt a section of Chinese industry, could have been handled better by Beijing. With Trump gone, China can relax a bit.

But Xi is one of the few world leaders who have not sent a congratulatory message to incoming US president Joe Biden. Apart from the need to hide his sense of relief after Trump’s departure, he is careful about giving the right signals to the Chinese public and media — to paint the US as a country that is divided and in decline. Sending a congratulatory message would, in Xi’s eyes, give Biden undue, special importance.

Biden can hurt China in other ways. US Democrats pay more attention to human rights issues than the demands of geopolitics. The new government may take up issues concerning suppression of human rights in Xinjiang, Tibet and Hong Kong, not to mention China’s dealings with dissenters, more strongly than the Trump administration.

India will watch this situation carefully. Any discussion on the suppression of Muslims in Xinjiang would impact China’s image across the border in Pakistan. Beijing needs support from not just Islamabad, but also from the Pakistani people and political system to implement its showcase China-Pakistan Economic Corridor (CPEC), which is part of the Belt and Road Initiative (BRI).

The US and China are at loggerheads on issues like Taiwan and military presence in the South China Sea. Trump did not create these wrangles. He and Xi took several steps to accentuate them. Neither US nor China will alter or dilute their stance. But there may be less sabre-rattling in public. When it comes to the trade war, Beijing expressed its satisfaction over US poll results, although indirectly.

Last year, Chinese Vice Foreign Minister Le Yucheng indicated that the two countries could bury the hatchet if the ‘next US government’ met China ‘halfway’ and upheld the principles of ‘non-conflict, non-confrontation, mutual respect and win-win cooperation; focus on collaboration; manage differences; and push forward bilateral ties along the right track’.

Of course, this is public posturing. Even China doesn’t expect the trade war to end any time soon. The two sides have been taking measures to reduce their dependence on each other and looking for alternative sources to procure goods. The US has banned major Chinese tech companies like Huawei and ZTE, hurting China’s growth plans in this area.

It may also be politically difficult for the newly elected Democrat leadership to reverse Trump’s trade policy. Washington’s new dispensation can hardly argue that its predecessor’s domestic economic policies have been rejected by the American people, considering the impressive economic performance despite the corrosive effects of Covid-19.

Actually, Biden will be under pressure to show himself more skillful in dealing with China than Trump. He will have to push China to buy more American goods without reducing the punitive taxes that Trump has imposed on Chinese goods. This is near impossible, unless he is able to show he has obtained special concessions from Beijing.

On its part, China may accommodate initial requests — even demands — from Washington to help the new US president stabilise, and later seek concessions of its own. ‘It is likely that the trade war will be adjusted and the Biden administration will be more pragmatic,’ Oxford political scientist Rana Mitter told me, adding, ‘It will push for more exports of American goods to China, but may not step back when it comes to public rhetoric against the Chinese government.’

One may argue that some key elements of a trade war have been missing of late. Americans bought 3% more Chinese goods in value terms in the first three quarters of this year, compared to the same period in 2017 before the new tariffs were introduced, according to numbers tabulated in Beijing. Though Chinese statistics are usually to be taken with a fistful of salt, they are usually not much off the mark in this matter.

Washington has done little to reduce its need for low-cost goods from China. Walmart and Amazon stores are filled with Chinese goods. This is unlikely to change as Americans are unlikely to avoid low-priced (Chinese) goods in favour of higher priced ones. Hence, Chinese manufacturers still have an assured market in the US.

The Biden administration may seek Beijing’s help on issues like climate change and strengthening international institutions like the World Bank, World Trade Organisation (WTO) and those related to the United Nations (UN). Mutual adjustments and back-room gives and-takes are expected. Xi played a key role in demonstrating China’s determination to reduce emissions and getting it accepted internationally.

But with the US pulling out of the Paris Agreement, this was of limited value. If Biden re-enters Paris, whether such a reversal can be easily implemented on an international level will be keenly followed. China and the US, which will continue to be the world’s two biggest polluters for a long time to come, will need each other to realistically implement low-carbon programmes.

The writer is author of Running With the Dragon: How India Should Do Business With China

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