Secretary of Defense James Mattis played down tensions with Beijing, saying the U.S. was “not out to contain China” and was cooperating whenever possible, but that there would be times they would “step on each other’s toes.” The United States and China are two of the largest economies in the world…
Secretary of Defense James Mattis played down tensions with Beijing, saying the U.S. was “not out to contain China” and was cooperating whenever possible, but that there would be times they would “step on each other’s toes.”
Background
The United States and China are two of the largest economies in the world. Both countries consider the other as a partner in trade and an adversary in geopolitics. Diplomatic relations between the US and China was first established in 1844 with the Treaty of Wanghia. This agreement allowed the US to trade in Chinese ports. After the Qing Dynasty was overthrown, in 1911, the US recognized the legitimacy of the Republic of China (ROC) government.
The U.S.–China Strategic and Economic Dialogue were created in 2009. Every year, high-level representatives from both nations open up dialogue to improve economic partnership. In 2017, the meetings that occurred were reported as being “tense”. Upon conclusion, the two countries cancelled a joint press conference and did not release a statement. They also did not release a plan of action.
US President Donald Trump has previously been a critic of China. He blamed the country for loss of jobs within the US and has often criticized the US trade deficit with China. China’s trade surplus with the United States widened in 2017 while total foreign trade volume maintained rapid growth.
Analysis
Secretary of Defense James Mattis played down tensions with Beijing, saying the U.S. was “not out to contain China” and was cooperating whenever possible, but that there would be times they would “step on each other’s toes.”
“Obviously, we’re not out to contain China. We’d have taken an altogether different stance had that been considered. It has not been considered,” he told reporters Monday on a plane en route to Vietnam.
“We seek a relationship with China that’s grounded in fairness, reciprocity and respect for sovereignty,” he said. He added that Washington is cooperating with China on issues including North Korea and the United Nations.
“So, we’re two large powers, or two Pacific powers, two economic powers. There’s going to be times we step on each other’s toes, so we’re going to have to find a way to productively manage our relationship,” he said.
Mattis spoke on his way to attend defence ministers’ meetings hosted by the Association of Southeast Asian Nations in Singapore, where he could cross paths with Chinese officials.
China cancelled high-level security talks with Mattis that had been planned for mid-October in Beijing, the New York Times reported on Oct. 1.
Trump called Mattis “sort of a Democrat” in a weekend interview with “60 Minutes.” He also hinted the former U.S. Marine Corps general may be planning to quit. Mattis is seen as a force for stability in foreign policy in the Trump administration, managing crises from North Korea to Syria under a leader who prides himself on his unpredictability.
Mattis’s latest attempt to soften the White House’s messaging came amid escalating rhetoric between the U.S. and China in recent weeks, as the world’s two largest economies remain locked in a trade battle.
Manoeuvres in the disputed South China Sea, including a close call between the U.S. and a Chinese destroyer, fueled Beijing’s concern that the U.S. wants to stop China from threatening its dominance of the Indo-Pacific.
Trump accused the Chinese of meddling in U.S. congressional elections while at the United Nations General Assembly, saying President Xi Jinping might no longer be a friend.
Counterpoint
However, the US still has serious concerns such as intellectual property rights and non-trade barriers put up by Beijing. Although Xi Jinping had recently promised to ease business restrictions in some industries, the Chinese economy remains protectionist. Presidents Jinping and Trump may be forced to reach a compromise that is amenable to both nations, to avoid disastrous consequences.
China has utilized its unique position as the world’s manufacturing hub and a largely protectionist economy by monopolizing the manufacturing industry for many sectors in the global economy. Secretary Mattis may indicate that the US does not want to contain China’s growth but the truth remains that China’s critical role in the US economy is an Achilles’ heel for Washington. The Trump administration has deployed a wide range of tools to combat China’s growing influence on US politics and the Economy.
Assessment
Our assessment is that Washington’s current protectionist stance could limit its own ambitions. As stated previously, a trade war would harm not only the US and China, but the entire global economy. If this rhetoric continues, it may affect the world GDP by 1-3 percentage points in the next few years and could wear down multilateral and bilateral trade regulations that have governed global markets since the 1990s.
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