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Prognoses on China-US Economic Relations

May 18-2020   



 

In the recent NSD MBA Forum, Prof. Zha Daojiong offered five prognoses on China-US relations under the stresses and strains of the pandemic. He specializes in non-conventional security areas and lectures at the School of International Studies at PKU and the Institute of South-South Cooperation and Development at PKU.

 

Prof. Zha argued that the interactions between the two countries are not as gloomy as might be inferred from news headlines. Though the public health departments of the two countries have had low-level cooperation, medical and research institutes on the two sides of the Pacific never cease to help and learn from each other. That China was able to promptly share gene sequencing of the coronavirus testifies to its professional capabilities benefiting from over four decades of public health collaboration between the two countries. On the other hand, Prof. Zha lamented the misfiring of mainstream media and think tanks in both countries, which have indulged in heaping irony and criticism on each other rather than uncovering the good practices to be learned.

 

On the economic front, Prof. Zha believed that notwithstanding the serious impact of the pandemic on the US, the White House would be unlikely to cancel punitive tariffs on Chinese goods. The first-phase deal puts an end to decades-long frictions and lays a foundation for future actions, yet its implementation might be subject to some uncertainties, notably disagreements over if the pandemic constitutes a force majeure.

 

China should adopt three principles in handling issues relating to the trade agreement and the de-coupling propensity of the US. The first principle is about building internationally compatible standards in such areas as technology, customs, accounting and logistics. The second one is to ensure fair price and great quality of Chinese products for both domestic and international markets. The third is to honor contracts and treat all partners fairly.

 

Prof. Zha went on to offer five prognoses on China-US trade relations, with the caveat that some of them might later prove to be false due to the dynamics of the election year in the US. His first prognosis was that disagreements might surface over the force majeure clause in the first-phase deal. The second prognosis was that medicines and medical supplies might see mounting pressures for de-coupling. The third was that the US would be likely to continue or even strengthen long-arm jurisdiction over Chinese companies. The fourth one was that the US might ram up anti-graft actions against Chinese firms in third-party countries. And the fifth one was that multilateral mechanisms might see a dwindling role in policy coordination among member countries. For every prognosis, Prof. Zha shared his advice on the stance and actions that China can take. Relations are bound to be a two-way street, but good faith, fair treatment of partners, and improving connection with international standards will aid China in no small measure, he said.

 

Prognoses on China-US Economic Relations

May 18-2020   



 

In the recent NSD MBA Forum, Prof. Zha Daojiong offered five prognoses on China-US relations under the stresses and strains of the pandemic. He specializes in non-conventional security areas and lectures at the School of International Studies at PKU and the Institute of South-South Cooperation and Development at PKU.

 

Prof. Zha argued that the interactions between the two countries are not as gloomy as might be inferred from news headlines. Though the public health departments of the two countries have had low-level cooperation, medical and research institutes on the two sides of the Pacific never cease to help and learn from each other. That China was able to promptly share gene sequencing of the coronavirus testifies to its professional capabilities benefiting from over four decades of public health collaboration between the two countries. On the other hand, Prof. Zha lamented the misfiring of mainstream media and think tanks in both countries, which have indulged in heaping irony and criticism on each other rather than uncovering the good practices to be learned.

 

On the economic front, Prof. Zha believed that notwithstanding the serious impact of the pandemic on the US, the White House would be unlikely to cancel punitive tariffs on Chinese goods. The first-phase deal puts an end to decades-long frictions and lays a foundation for future actions, yet its implementation might be subject to some uncertainties, notably disagreements over if the pandemic constitutes a force majeure.

 

China should adopt three principles in handling issues relating to the trade agreement and the de-coupling propensity of the US. The first principle is about building internationally compatible standards in such areas as technology, customs, accounting and logistics. The second one is to ensure fair price and great quality of Chinese products for both domestic and international markets. The third is to honor contracts and treat all partners fairly.

 

Prof. Zha went on to offer five prognoses on China-US trade relations, with the caveat that some of them might later prove to be false due to the dynamics of the election year in the US. His first prognosis was that disagreements might surface over the force majeure clause in the first-phase deal. The second prognosis was that medicines and medical supplies might see mounting pressures for de-coupling. The third was that the US would be likely to continue or even strengthen long-arm jurisdiction over Chinese companies. The fourth one was that the US might ram up anti-graft actions against Chinese firms in third-party countries. And the fifth one was that multilateral mechanisms might see a dwindling role in policy coordination among member countries. For every prognosis, Prof. Zha shared his advice on the stance and actions that China can take. Relations are bound to be a two-way street, but good faith, fair treatment of partners, and improving connection with international standards will aid China in no small measure, he said.