US-China talks may end up igniting trade tensions

US-China talks may end up igniting trade tensions

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US Secretary of State Tony Blinken and national security adviser Jake Sullivan are going to the two-day meeting with Chinese colleagues Wang Yi and Yang Jiechi in Anchorage, Alaska, carrying a lot of luggage.

Former President Donald Trump has spent much of his term increasing tensions between the world’s two largest economies. It sparked a fierce trade war that the two sides have yet to fully resolve. And he punished some of China’s most prominent technology companies with crippling sanctions, largely for concerns that they posed a threat to US national security.

For now, other political disputes are more likely to dominate the talks in Anchorage, according to William Reinsch, a trade expert at the Center for Strategic and International Studies who served for 15 years as president of the National Council on Foreign Trade.

The two countries have recently clashed over a range of issues, including the crackdown from Beijing to Hong Kong, a former British territory, and allegations of widespread human rights abuses in China’s western Xinjiang region.

China expects the Alaska meeting to deviate from trade policy and eventually lead to a reversal of U.S. tariffs, as well as its commitments to buy more U.S. products. America is not ready to make concessions.

“I don’t think it has fallen into the limited flexibility that the president has in light of the strong shift in US public opinion against China and the strong demands of Congress from both parties for a hard line on China,” Reinsch told CNN Business. “Therefore, trade and technology remain issues, but the other issues, particularly human rights, are now at the top of the list.”

Washington must have already guaranteed that geopolitics will be the focus of the meeting. Earlier this week, the U.S. government sanctioned two dozen Chinese and Hong Kong officials after Beijing further restricted the ability of people in the city to freely elect their leaders. Blinken also criticized China at a meeting with his counterparts in Tokyo on Tuesday, where he accused Beijing of threatening regional stability.

Neither side has indicated that they see Anchorage as a place for significant changes in their relationship. The Biden government emphasized that the summit is “a one-time meeting” that “is meant to be an initial discussion”. And Beijing said it did not have “high expectations” for the event.

“Lowering hopes for the meeting reflects domestic policy – on the US side, Biden wants to avoid looking too lenient with Beijing – but also the broader state of the relationship,” analysts at the Eurasia Group wrote in a research note last week. “Neither the US nor China is willing to make concessions that the other believes are necessary to significantly relax tensions.”

Human rights issues, meanwhile, may actually exacerbate some of the major economic pain points in the future.

The US-China rivalry in technology and trade will not end because Joe Biden is the president
The United States has already raised concerns about Xinjiang in last year’s decisions to reduce imports of in that region – an attempt to prevent forced labor products from entering the U.S. market. (Beijing has long defended its crackdown in Xinjiang as necessary to combat extremism and terrorism. And contrary to accusations that it forces people to enter labor camps, it says its facilities are voluntary “training centers” where people learn vocational skills, Chinese language and laws.)

“The Biden government will link human rights issues to exports [and] technology sales, “said Alex Capri, a researcher at the Hinrich Foundation and a senior visitor at the National University of Singapore.” Expect to see more export controls and sanctions against Chinese interests. “

Capri and others also say that the United States will continue to do what it can to separate parts of its economy from China. He pointed to Biden’s recent efforts to review US supply chains – a move widely seen as an attempt to ensure that essential products and supplies are not indebted to Beijing.

“Biden’s ‘Build Back Better’ platform is actually a more coherent version of [Make America Great Again], when it comes to strategic reshoring and ring-fencing sectors, “Capri told CNN Business, pointing to potential efforts to remove China from the supply chains of pharmaceuticals, semiconductors, batteries, rare earths and artificial intelligence as” just the beginning “.

Correction: An earlier version of this story mistakenly disclosed Xinjiang’s location in China.

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