Three ways to rebuild US-China trust after ‘spy balloon’ row
Officials must steer competition away from sensitive areas and focus on global stability, and moderates must return to face-to-face backchannel dialogues
Crucially, both sides must end the escalation in vitriol and unpredictability
Sino-American relations briefly thawed after President Xi Jinping’s meeting with US President Joe Biden in Bali, Indonesia, last November.
Much of that goodwill turned out to be more transient than expected. The Republican-majority House of Representatives has established a select committee to brace the United States for its “strategic competition” with China’s ruling party, with bipartisan support for greater financial and technological decoupling. Elsewhere, legislators in Texas and other states are calling for a ban on Chinese citizens buying land and/or property in their states.
The recent ignominy over the alleged “spy balloon”, then, was as much a symptom as a cause of a further deterioration in Sino-American relations.
A balloon of Chinese origin, alleged to be a tool of surveillance and reconnaissance for Beijing, was shot down in American airspace on February 4 – much to Beijing’s chagrin. Washington has framed the episode as indicative of China’s expansionist surveillance regime. Since then, the US has shot down three other unidentified objects.
The road ahead is treacherous, but not all hope is lost. There are three concrete steps by which bilateral relations can be repaired.
First, while great power competition is likely to continue, China and the US can compete in a more responsible, mutually advantageous manner by shifting away from unproductive squabbles and unsound economics. Former president Donald Trump’s trade war against, for instance, China was unwinnable for a simple reason.
As commentators such as economist Stephen Roach and financial adviser James Fok have pointed out, America’s “trade deficit problem” has little to do with China, and everything to do with its savings deficit and dollar dominance in international trade. China, meanwhile, has a savings glut problem best served by reorienting its economy towards domestic consumption and high-end services.
As it turns out, both parties may have independent interests in pursuing a narrower trade deficit – just not via the insatiable purchasing targets stipulated by the phase-one trade deal.
With US Treasury Secretary Janet Yellen tipped to visit China soon, it is high time for China and the US to draw an end to vacuous negotiations over unrealistic targets, to work on reducing barriers to investment in non-sensitive and non-security related areas, and explore mechanisms to uphold global macroeconomic stability as tensions worsen with the Ukraine war.
Even where competition is inevitable, it should be contained in areas where conflicts of interest are unavoidable, e.g. the military and security, as opposed to bilateral trade and investment.
Second, the respective rhetoric in Washington and Beijing highlight the need for trust-building across both the highest echelons of governments, as well as the citizenries of both countries.
Allegations of foreign infiltration and paranoia rooted in national security concerns have rendered bilateral exchanges precipitously difficult – political establishments on both sides are unconvinced of the merits of “track two” engagement – backchannel diplomacy involving non-governmental contacts – and are gradually concluding that such engagement is futile.
It is against this backdrop that moderates and pragmatists, including leading finance professionals, businessmen and academics, ought to speak up. They must make the case for synergy in the relationship, such as in public health, climate change and peacekeeping in conflict zones such as Haiti – all areas where common ground can be forged.
Yet, merely calling for such low-hanging fruit is not enough to reset Sino-American relations – these areas often take a backseat as animosity and scepticism rise, even between civil society interlocutors and long-standing friends.
To tackle the malaise, Chinese and American interlocutors must seize upon China’s reopening to engage in person in backchannel dialogues across all levels. These would be in-depth conversations where the objectives are not so much to identify concrete, precise prescriptions, as to figure out what can or cannot be negotiated – i.e. the terms and rules of engagement.
A dough artist demonstrates his craftsmanship on January 15 during a folk arts and cultural festival in Flushing, New York, US, organised to celebrate the Lunar New Year. Sino-American cultural and arts exchanges can go a long way in ameliorating prejudices and misconceptions. Photo: Xinhua
Public diplomacy should be reoriented towards joint ventures as opposed to unidirectional propaganda – for one, Sino-American cultural and arts exchanges can go a long way in ameliorating prejudices and misconceptions, whether anti-American sentiments on the Chinese mainland or Sinophobia on American soil.
Third, it is in both China and America’s interest to recognise that doubling down on hawkish rhetoric and actions may satisfy domestic political agenda – mollifying a nationalistic public after three years of pandemic control in China, or improving political leverage over a deeply divided House and a particularly trenchant Republican Party.
Yet the escalation in vitriol in Sino-American relations would only increase systemic risk – in military conflict, malign technological rivalry and supply chain re-routing-induced cost-push inflation – for most stakeholders in Asia.
Beijing clearly views its moderation in diplomatic rhetoric and overtures over the past few months as a significant olive branch to the proverbial West, albeit one that might be withdrawn in the face of perceived provocation.
Washington, on the other hand, views itself as being in a position of strength – having driven measures that have potentially kneecapped China’s wherewithal and growth trajectories in the semiconductor industry. It sees little immediate need to negotiate and compromise.
Yet the push for de-escalation cannot be one-sided. Both sides should realise that in an age of global hyperconnectivity and existential challenges – from risk of nuclear war to global warming – the world needs China and the US to work together, and not just against one another.
Responsible stewardship from political leaders of the world’s two largest economies, would go a long way in restoring stability to bilateral relations, even with a burst balloon.
Brian Wong is a DPhil in Politics candidate at Balliol College and teaches politics at the University of Oxford as a Rhodes Scholar (Hong Kong 2020)
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