Rather than decouple, China and the US must find ways to coexist
- Clear thinkers in China know a bitter divorce from the US is a lose-lose situation
- Beijing could instead seek healthy competition and cooperation with the US, expand operations of Chinese brands in America, and aim to be more transparent
Moreover, an outright divorce between the United States and China – or a decoupling of their economies – isn’t actually helpful to anyone when the two economies are so intertwined.
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The US and China need to rethink their rules of engagement with each other. They can start by listening and acknowledging the validity of each other’s complaints, to carve a mutually agreeable path forward. The meeting in Hawaii could be the start of more down-to-earth dialogue.
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While the US continues to be the largest economy, decades of offshoring and outsourcing have hollowed out its manufacturing sector. The share of manufacturing employment had dwindled to below 5 per cent of the population by 2018 and that of adults in middle-income households fell from 61 per cent in 1971 to 51 per cent in 2019.
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Such a move could benefit all parties concerned. While Chinese companies hire more American workers, it may help American consumers embrace Chinese brands, like they did with Japanese brands.
At the same time, the Chinese government could develop a programme with the US that issues working visas to American graduates in STEM (science, technology, engineering and mathematics) and allows them to get practical training at leading companies in China, and to Chinese engineers and scientists helping the US develop competencies.
Currently, the US produces around 500,000 STEM graduates per year, whereas the number from China is much larger (4.7 million in 2016).
Washington and Beijing need to calm down, reconsider the need for an economic decoupling, and establish a modus vivendi. While full cooperation may not be achievable, “coopetition” between the two giants would be welcomed by the world – and it could be good for the two countries as well.
Christine Loh is chief development strategist in the Institute for the Environment at Hong Kong University of Science and Technology. Christopher S. Tang is a distinguished professor and holds the Edward W. Carter Chair in Business Administration at UCLA Anderson School of Management