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Navigating US-China Relations: Trends in Trade and Diplomacy

by Geraldine S.
04/03/2021
in Economic Indicators, Global Trade, International Relations, Tariffs & Duties, Trade Agreements, Trade Policies

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The recent U.S.-China meeting in Alaska showcased the Biden administration’s approach to managing relations with China. Secretary of State Anthony Blinken addressed various concerns, including issues in Xinjiang, Hong Kong, Taiwan, cyberattacks, and economic coercion. This stance indicates a continuation of the previous administration’s policies, albeit with a more multilateral strategy involving allies, as seen in the Quad dialogue with Australia, India, and Japan.
The Trump administration marked a significant shift in U.S.-China relations, notably in trade policy, initiating tariffs on $250 billion worth of Chinese goods and identifying trade as a major security issue. While the “phase one” deal with China represented a de-escalation, it was more of a ceasefire than a lasting solution. President Biden has maintained tariffs against Chinese goods and ordered a review of critical technology supply chains to reduce U.S. dependency on China. The ongoing public rhetoric and issues such as the South China Sea disputes continue to fuel tensions between the two nations.
Public opinion in the U.S. has significantly shifted, with a majority viewing China unfavorably and as a potential threat, a sentiment shared across political parties. This unified perspective influences policymakers to maintain a firm stance on China to avoid perceptions of weakness. The shift in the Republican Party’s stance on trade and economic policy, particularly towards China, is notable. The party, traditionally a proponent of free trade, has seen a paradigm shift, emphasizing a more protectionist approach. This bipartisan consensus extends to other contentious issues, including territorial disputes and human rights concerns.
However, this confrontational approach and public rhetoric can create challenges in negotiations due to audience costs and reputational losses. Audience costs refer to domestic backlash against political leadership for compromising on threats or demands, while reputational losses concern the long-term credibility impact. These factors can hinder negotiators, increasing the risk of negotiation failure and escalating tensions. The U.S. and China’s growing strategic rivalry and confrontational policies could lead to intractable conflicts over intangible issues, transforming economic disputes into matters of national security or honor. This shift from tangible to intangible stakes increases the risk of escalation and complicates conflict resolution.
Understanding these dynamics is crucial for navigating the complex relationship between the U.S. and China. The Thucydides trap, a concept describing the tendency toward conflict between a rising and an established power, underscores the importance of strategic and cooperative approaches in international negotiations to prevent escalation and foster mutual understanding.

Your source for supply chain report news updates: The Supply Chain Report. For international trade insights and tools, head to ADAMftd.com.

#USChinaRelations #BidenAdministration #AnthonyBlinken #QuadAlliance #USChinaTrade #EconomicPolicy #XinjiangHongKongTaiwan #Cybersecurity #EconomicCoercion #SouthChinaSea #ThucydidesTrap #GlobalDiplomacy #TradeWar #StrategicRivalry #HumanRightsConcerns #SupplyChainReview #GeopoliticalTensions #BipartisanConsensus

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