An era of great misunderstanding of China

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The recent San Francisco rapport between US President Joe Biden and China’s President Xi Jinping has resulted in a flurry of fence-mending visits to Beijing by top US officials, including Treasury Secretary Janet Yellen and Secretary of State Antony Blinken. 

It has also made possible for Commander of the US Pacific Fleet, Admiral Stephen Koehler, to lead a naval delegation to attend a four-day Western Pacific Naval Symposium (WPNS) in Qingdao hosted by the PLA Navy, which attracted over 180 navy representatives from 29 countries. 

Meanwhile, the US House of Representatives passed the Indo-Pacific Security Supplementary Bill providing $8.1 billion to counter Beijing in the region, $3.3 billion to develop submarine infrastructure, and $2 billion military financing plus $1.9 billion military replenishment for Taiwan and other US allies and partners. At the same time, the U.S and Philippines kicked off their largest-ever 19-day joint military drills, dubbed “Balikatan 2024”, in the South China Sea. 

The House also approved the 21st Century Peace through Strength Act, which includes a measure that could lead to a national ban on TikTok, a short video hosting service owned by Chinese internet company ByteDance. 

Concurrently, Biden officials are urging the Netherlands to stop ASML Holding NV, the world’s unique nano-semiconductor chip-making machinery owner, from servicing and repairing sensitive chip-making equipment acquired by China. 

Despite Biden’s repeated assurances that the United States thinks that it’s in the interest of the world for China to succeed; that it does not seek a Cold War or conflict with China; and that it continues to support the One China Policy, Beijing may be forgiven to think in terms of American double-standards, hypocrisy, and sheer chicanery.

That China represents America’s greatest “existential threat” is now bipartisan. Across the aisle, American elites believe that the US can cooperate with China where they should, keep communications open where they can, and confront China where they have no choice.

Previous decades of more amicable US-China relations have clearly degenerated into a dangerous era of what John Mearsheimer calls The Tragedy of Great Power Politics (University of Chicago, 2001), what Graham Allison brands the “Thucydides Trap” (in Destined for War, Scribe Publications 2017), or what Samuel Huntington calls the Clash of Civilizations (Simon & Schuster, 2011).

Much of the sabre-rattling is due to deep-seated misunderstanding between two diametrically-opposed American and Chinese national DNA’s. 

The US-led rhetoric about democracy versus autocracy assumes that the Chinese Communist Party (CCP) government is on the wrong side of history. This ignores recent findings of the Harvard Kennedy School Ash Center (Understanding CCP Resilience, July 2020), New York-based Edelman Trust Barometer (2023 Global Report) and Paris-based IPSOS research (Global Happiness 2023). They all find that the CCP government is amongst the best trusted and supported by their people, multiple ranks above the United States and other Western democracies. Witness the dramatic transformation of the Chinese people’s lives in the past four decades, earlier setbacks notwithstanding. 

In response to perceived “unfair” trading practices, including intellectual property “theft” and lack of market reciprocity, under the policy of “high-standard opening-up”, China has recently adopted a series of measures to improve market access and the level-playing field for foreign businesses, including banking, insurance and technology.  Beijing has earlier enacted laws forbidding “forced” technology transfer. 

However, the West’s recent mantra of “overcapacity” hides the unpalatable truth that except perhaps top high-end semiconductor chips, large-bodied passenger jet engines, and some frontier science and technologies, Western products have become increasingly non-competitive by comparison.

Subsides are common amongst most nations. Witness the 2022 U.S. Inflation Reduction Act providing billions to American businesses. Wage differentials aside, what sets China apart is its all-encompassing supply and value chain with unrivaled nimbleness, efficiency and economy of scale. Even not “Made in China”, various products across the globe have China embedded in terms of rare earths and other minerals, specialized components, processes and logistics. Seven of the top eleven container ports are in China, including Hong Kong. 

Any substantial decoupling in the name of “de-risking” is unlikely to yield desired results. 

Be that as it may, to avoid uprooting key industries in Western countries, China should be well advised to explore “win-win” solutions for Western trade partners facing grim prospects of industrial retrenchment, perhaps by way of suitable joint ventures and equity investments.  

Another popular myth is that China lacks technological innovation. However, the Australian Strategic Policy Institute (ASPI) recently finds that China is the leading country in 37 of the 44 critical technologies evaluated, often producing more than five times as much high-impact research as its closest competitor the United States. 

China’s technological advance is perhaps not surprising. Since the mid-2000s, China has consistently been producing more STEM PhDs than the United States. By 2025 Chinese universities will be producing more than 77,000 STEM PhDs per year compared to approximately 40,000 in the United States. Excluding international students, Chinese STEM PhD graduates would outnumber their U.S. counterparts more than three-to-one, according to George Town University’s CSET. 

Despite being entirely excluded from the US-led International Space Station, which is nearing the end of its useful life, China has succeeded in building from scratch its own Tiangong Space Station, which has become fully operational since late 2022. 

It’s important to understand that China has no capacity or intention to replicate the United States’ military presence of 750 bases in some 80 countries across the globe. Even China is expected to have more than 1,000 operable nuclear weapons by 2030, this pales in comparison with the United States’ current stockpile of 3,700 warheads. 

The advent of the digitally-connected and borderless Fourth and Fifth Industrial Revolutions is redefining how peoples live and work, how businesses are conducted, and how nations interact with each other. We are witnessing epochal challenges and opportunities not seen in a hundred years, as President Xi has said. 

To avert worsening US-China relations, merely building guardrails is hardly enough. The world would be a better place if some of the above deep-seated misunderstandings are cleared.



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