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US president Joe Biden and China’s President Xi Jinping plan a virtual meeting next week, after months of rising tension between both economic giants.Political analyst Victor Shihsees the meeting as a step forward,he tells CNN.
CNN:
US officials revealed last month that they had reached an agreement in principle with China to hold a virtual meeting between Biden and Xi before the end of the year, as part of an effort to ensure stability in one of the world’s most consequential and fraught relationships.
That tentative agreement was the result of an extended, six-hour meeting between Biden’s national security adviser Jake Sullivan and China’s top diplomat, Yang Jiechi in Switzerland, just days after Beijing sent record-breaking number of warplanes into Taiwan’s defense zone.
Victor Shih, an expert on elite Chinese politics at the University of California, San Diego, said the meeting is a positive development for bilateral relations.
“I think the bilateral meeting next week is a preliminary sign that the relationship between the US and China is getting back on a more normal track — than (what) had been the case in the later Trump years,” Shih told CNN.
The meeting is also likely to motivate officials, especially on the Chinese side — from the Foreign Ministry to the Commerce ministry — to once again focus their energy on US-China relationship and think of ways to improve it, Shih added.
The last time Biden and Xi spoke was in September, in a phone call that lasted roughly 90 minutes.
China watcher Kaiser Kuo describes at the Varn Vlog how US-China relations went downhill since the 2008 financial crisis, and how that did not improve after President Joe Biden took over from Donald Trump. Also: how the Red Deal in China is changing domestic relations in China.
China and the US have continued their warrior diplomacy, also after US president Joe Biden took over from Donald Trump. CFR-scholar Ian Johnson sees both upsides and downsides in the fierce language both countries use to define their relationship, he tells at ShanghaiEyes.
Mr. Biden’s most effective attempt so far to reorient America’s China policy has been to re-energize U.S. alliances and international commitments. At a virtual summit last week, Mr. Biden and the leaders of Japan, India and Australia stressed the need for coordinated action to counterbalance China’s growing assertiveness in the Indo-Pacific region.
But that leaves unresolved almost all major bilateral issues, including: how to deal with the trade sanctions imposed by the Trump administration; China’s military expansion in the South China Sea; how to handle weapons sales to Taiwan; or what to do about Chinese tech giants, such as Huawei, that offer Western countries technology that is cheap but may be a Trojan horse for Chinese intelligence services.
What’s needed are immediate low-rent measures to reverse the downward spiral in the two countries’ relations.
One, the Biden administration should offer to restart the Peace Corps and Fulbright scholarship programs in China, two key ways that Americans have learned about the country over the past decades. The Trump administration canceled both as part of an effort to isolate China. All that accomplished instead was to hurt America’s ability to train a new generation of scholars and analysts.
Two, in exchange for this, the U.S. government should stop vilifying China’s Confucius Institutes as sinister propaganda machines. These are largely cultural centers and much like educational outposts from other countries trying to push a good image of themselves. American universities should prevent Confucius Institutes from offering accredited courses — no university should allow a foreign government to set its curriculum — but the centers should be able to function off campus, much like Germany’s Goethe Institutes or British Councils do.
Three, the Biden administration should allow back into the United States some of the scores of Chinese journalists expelled by the Trump administration last year — provided that Beijing also agrees to welcome again accredited journalists from American news organizations and commits to not harassing them.
The Trump administration’s measures gutted America’s ability to understand China. China, by contrast, still has many reporters and diplomats, and tens of thousands of students in the United States.
Four, the U.S. government should lift restrictions on visas for Chinese Communist Party members wanting to travel to the United States. The policy was crafted to protect Americans from the C.C.P.’s supposedly malign influence. But the party counts some 90 million members, the majority of whom are civil servants doing normal jobs, not followers of some evil cult that needs to be kept at bay.
Finally, China should be invited to reopen its consulate in Houston, which the Trump team closed last year in retaliation for alleged espionage. In return, the Chinese government would allow the United States to reopen its consulate in Chengdu, which Beijing had closed in retaliation.
These are small measures, but they could be meaningful confidence-building steps and pave the way for more constructive exchanges later on thornier problems, such as the threat of war with Taiwan, conflicts in the South China Sea or industrial espionage.
Also: None of these measures are gifts; they require something in exchange. As such, they would serve as a test of Beijing’s willingness to improve relations. If Beijing turns them down, Washington will know much more clearly the scope of the problem.
Modest moves might seem less decisive than acting tough, but they are what, in the end, makes realpolitik real.
China counts more than 1,000 billionaires in US dollar terms, overtaking solidly the US, according to the Hurun Rich List ranking. “We’re currently in the heart of a new industrial revolution, with new technologies including artificial intelligence, blockchain, cloud, data and e-commerce creating new opportunities for entrepreneurs and leading to a concentration of wealth and economic power on a scale never seen before,” said Hurun Report Chairman and chief researcher Rupert Hoogewerf,according to Shine.
Shine:
China has the world’s most billionaires — more than the United States, India and Germany combined — due to a flurry of new initial public offerings and the booming digital economy over the past year despite the pandemic, according to the latest Hurun rankings.
The combined wealth of billionaires in China is US$4.5 trillion, up 73 percent from last year.
China currently has 1,058 billionaires, up 259from a year ago and far surpassing America’s 696 billionaires.
According to the Hurun rankings, the number of billionaires in China began to overtake the US in 2016.
“We’re currently in the heart of a new industrial revolution, with new technologies including artificial intelligence, blockchain, cloud, data and e-commerce creating new opportunities for entrepreneurs and leading to a concentration of wealth and economic power on a scale never seen before,” said Hurun Report Chairman and Chief researcher Rupert Hoogewerf. “Despite the disruption caused by COVID-19, this year has seen the biggest wealth increase in the last decade.”
China is the first country in the world to have more than 1,000 billionaires.
Fuelled by a desire to keep up with the US and China, traditionally passive sovereign wealth funds are increasingly deploying capital into strategic development areas like infrastructure, communications and more recently the digital economy according to global investment manager and academic Winston Ma.
No longer mere “stabilizers of capital markets”, the sovereign wealth funds of the world – which control around US$30 trillion in funds – are building internal teams and becoming more “active and direct” in their investment style, Ma explained on a recent Investment Magazine Market Narratives podcast.
Part of the reason is to save money, he said, by eschewing external management teams.
A larger purpose, however, is because these funds serve as domestic economic promotion agencies that drive strategic development agendas linked to sectors like infrastructure, telecommunications and increasingly, the digital economy.
“All countries are looking to sovereign funds as a policy tool to promote domestic research and development in order to stay as a relevant information centre besides China and the US,” Ma explained. “For Europe, Japan and places like India they need to think about how they can stay competitive in these digital revolution competitions.”
Many countries and regions are now setting up specific sovereign wealth funds tied to singular strategic objectives, he explained. The EU is looking to set up a €100 billion to finance European tech “champions” competing with alibaba and facebook, for example, while Japan is reported to have set up a 6G research fund, Ma said.
“That’s not a typo,” he added. “They’re already thinking ahead. If they’re late to the 5G competition they want to get ahead on the 6G.”
Former US President Donald Trump tried to derail relations with China by banning stocks from Chinese companies at US stock markets. Now, under President Joe Biden, certainty for stock markets including the Chinese shares is key, says former White House advisor Harry Broadman at US News. Although there might be some other dangers.
US News:
The use of investment bans on Chinese stocks is a “curious tool,” says Harry Broadman, managing director with Berkeley Research Group, who has served in two White House administrations. He was chief of staff of the president’s council of economic advisers under President George H. W. Bush and then served as a U.S. assistant trade representative under President Bill Clinton.
“One would think having U.S. investors in [Chinese] firms could produce salutary outcomes for people interested in reforms,” Broadman says.
“You don’t need a Ph.D. in economics to understand that if you’re going to continue to change the regulatory treatment, including the listing and delisting of firms,” uncertainty will follow, Broadman says…
Another risk that’s generally well understood by investors is the tight control that Chinese President Xi Jinping and the Chinese Communist Party have over industries within their borders. Investors can’t expect to challenge unfair government policies with sound legal maneuverings as they might in the U.S.; China’s whims instantly become reality – just ask Jack Ma, the majority shareholder in Ant Group, whose IPO was unceremoniously put on ice in the wake of Ma’s criticism of Chinese regulators.
But there’s another risk that’s a bit more alarming, says former U.S. diplomat Broadman, and it’s arguably a much bigger concern for U.S. investors than any future delisting threat.
“I’ve been surprised that U.S. regulators over the years have treated Chinese firms and investments as being of the same quality as firms from the EU or Brazil,” Broadman says. “The notion that these firms are following international accounting rules is a bit of a fantasy,” Broadman says of Chinese stocks in general.
“The reason why U.S. regulators are interested in allowing these Chinese firms to be listed is you’ve got U.S. stock exchanges that are in competition (with other international) equity markets,” Broadman says.
“You come to the age-old question of public policy and what’s the right call to make. But I see no real discussion of the quality of their accounting. And I think it’s a big issue,” Broadman asserts.
China’s upcoming digital currency is the last example of how the country is economically going to outrun the US and the rest of the world, says Singapore-based superinvestor Jim Rogers. Of course, the country has collapsed a few times too, but unlike other cultures, it is able to rise again, he says.
More than three million Chinese students went to the US for their study, but with the rising sinophobia both the US and Australia are losing out huge advantages of those eager learners, says business analyst Shaun Rein to state-broadcaster CGTN. Even losing only tuition fees might cost them dearly, he adds.
The US failed to stamp out the coronavirus, unlike China, says Harry Broadman, a former senior US trade official to the Sydney Morning Herald. And since South Korea and New Zealand also dealt with COVID-19 efficiency, it is not China’s authoritarian regime that made the difference, he adds.
The Sydney Morning Herald:
“Obviously, the US government bungled it,” said Harry Broadman, a former senior US trade official and managing director with Berkeley Research Group. The singular authority of China’s Communist Party helped Beijing enforce contact tracing and lockdowns, Broadman said. But other democracies, including New Zealand and South Korea, stamped out the virus as China did.
The real difference between the US and China was that Washington “has been arguing over stimulus issues on Capitol Hill and it’s still far too little and too late”, said Broadman, who has served under both Republican and Democratic presidents. “That has created more and more uncertainty on the part of business.”
Just imagine China would send 60 planes close to Florida, says Shanghai-based political analyst Shaun Rein about the recent rise in tensions between the US and China. The situation is escalating in a dangerous way, he says.
China veteran Kaiser Kuo discusses the relations between the US and China, and here focuses on the splintering of the internet, at a wide-ranging interview at the Wire China. “I also think we need to recognize that our worries are more about us than they are about China. We have in this country a real problem with surveillance capitalism, as it’s been called,” says Kaiser Kuo.
Wire China:
Given that first narrative switch you described — the now-accepted idea that technology has not led to a more open political system in China — many people talk about the splintering of the global internet. Do you think a splintering is inevitable?
To some extent, we have to recognize that there has already been a splintering when it comes to a lot of popular services on the internet. A lot of that owes to China’s very severe regime of internet censorship. But I worry about the United States accepting this as a norm and simply going along with it and imposing these same types of objectionable ideas that run so counter to our core values. I think the impact of it is not so much economic as it is moral, and it would be a betrayal of our values to embrace this. I think we should all be working to have a more open internet rather than acquiescing, and proactively helping it toward this other outcome — a splintered, fragmented, and decoupled internet.
I also think we need to recognize that our worries are more about us than they are about China. We have in this country a real problem with surveillance capitalism, as it’s been called. Our concerns over Chinese tech have been amplified in large measures by our worries about how American tech companies are treating our data, and following our every click online and targeting us with greater and greater precision.
Let me put it this way: the Trump administration and its moves against companies like Tencent’s WeChat and Bytedance’s TikTok were clearly never about national security. They were never about data privacy. We’ve seen that now. It’s clear, at least to me, that they were about this broader project of suppressing China’s technology prowess, and were very much of a piece with what we’ve done with Huawei. There are important differences between them, of course. And I think from a national security point of view, you could certainly make a stronger case for Huawei being of concern. But when you look at WeChat, which has users only in the single digit millions in the United States, almost all of them are either Americans with strong connections to China or are Chinese nationals or ethnic Chinese. That national security case is very weak. With TikTok, it’s almost laughable.
The WeChat and TikTok ban is a good example of how many American lawmakers view the U.S.-China tech competition as a zero-sum game. Are there areas where you could imagine productive cooperation in technology between the two countries?
I think if you look back over the last 30 years, cooperation in technology has been fantastically fruitful. Let’s start with immigration policy. The Trump administration is going after H-1B visas and trying to restrict the ability of ethnically Chinese scientists, researchers or technologists to participate in research in the United States. All these things are shooting ourselves in the foot and surrendering, or deliberately blowing up, what is probably the single greatest advantage that this country has had in technology. You only have to look at the great companies of Silicon Valley, Seattle, or Boston, and look at a list of the surnames to realize what kind of contribution is being made by people who the Trump administration’s Department of Justice is targeting through its China initiative, that Homeland Security is trying to prevent from entering this country, and that the Trump administration is attempting to demonize. Part of productive technology cooperation would be stopping this utterly feckless policy and reversing it. We can do that and still protect American national security interests if we put a little more trust into the natural immune system of an open society.
Ironically, TikTok has become the ideal platform to spread American soft power, says business analyst Shirley Yu at Yahoo Finance. “The fundamental competition between the US and China is going to be technological competition,” which will have a big impact on the media landscape and the way in which we live, she says.
Yahoo Finance:
With the world’s second largest economy investing heavily in technology and innovative startups, China’s digital footprint is growing while the US seeks to dominate the digital landscape. This is leading to profound changes taking place within society as digital infrastructure plays a bigger role in our daily lives and people become more interconnected globally, and at high speed.
Shirley Yu, a Harvard-educated political economist and expert in strategic and economic affairs said this week that “the fundamental competition between the US and China is going to be technological competition,” which will have a big impact on the media landscape and the way in which we live. The global media figure, former CGTN news anchor and founder of Business Talk Show Hey China! said that despite China’s economic growth and recent successes including TikTok, it had yet to make its mark culturally around the world in the same way that the US has done so. “China does not, or has not produced very many strong public voices on the global stage who can communicate effectively in policy, in media, or even in politics, in a sophisticated way, with the rest of the world,” said Yu. Despite the success of Bytedance’s TikTok, the Hey China! talk show host admitted that it is a crucial moment for the world to give a voice to the change-makers, thought leaders and Gen Z doers, who can tell their untold paradigm changing stories about China to the world, and bring inclusion to the media.
“China has not been able to develop a generation of global media icons, nothing near what the US has accomplished in this regard,” Yu reflected. However, when asked about the potential banning of TikTok in the U.S., Yu noted that, “If you watch TikTok, TikTok has become ironically the perfect platform to spread American soft power, through the songs, dances and culture. American youth have successfully used a Chinese platform to spread American soft power all over the world.”
But as the technological competition heats up between the two world powers, companies like TikTok and Huawei have been caught up in the geopolitical confrontations, facing boycotts and bans in various countries. However, the technological shift toward 5G and China’s large investments in areas including IoT, AI, smart cities and digital tech means that the rest of the world including the US will be eager to match that effort – changing how we communicate and connect over the long-term.
US president Joe Biden and China’s President Xi Jinping plan a virtual meeting next week, after months of rising tension between both economic giants. Political analyst Victor Shih sees the meeting as a step forward, he tells CNN.
