China and the U.S. in the Next Decade
With growing tensions between China and the United States over trade and tariffs, the EastWest Institute held a roundtable with 30 high-level U.S. and Chinese corporate and government professionals at its headquarters in New York on April 9.
Admiral William A. Owens, former vice chairman of the U.S. Joint Chiefs of Staff and co-founder and executive chairman of the Red Bison Advisory Group, joined EWI chief executive officer and president, Ambassador Cameron Munter and Dr. Lora Saalman, vice president of EWI’s Asia-Pacific program, to chair an exploration of the opportunities and challenges in the increasingly complex U.S.-China relationship. The following are a few of the key non-attribution takeaways of this session:
- A U.S. participant noted that there is a lack of reciprocity and balance in the U.S.-China economic relationship. He argued that China has been unfairly restricting foreign firms’ access to its market, as well as gaining unfair advantage through forced intellectual property transfer.
- One Chinese expert argued that the U.S. economy is facing a trade deficit due to a variety of natural causes and self-inflicted trends, including a “lack of innovation,” and it is unfair to target China with protectionist measures, since it is only one part of the global industrial chain.
- A U.S. attendee noted that the Belt and Road Initiative could lay the foundation for the next century of global growth and integration. Another U.S. participant cited the difficulty of attracting external investors to BRI with ambiguous and distant returns on investment, as well as unmapped risks on the ground.
- Several U.S. participants argued that China and the United States are facing disruptive changes brought by major technological advances, such as in quantum computing, artificial intelligence, and machine learning that will have profound effects on their respective militaries and societies.
- A U.S. participant noted that both China and the United States are confronted by aging populations and wealth disparities. He suggested that these could provide areas for mutual exchange and entrepreneurial opportunities to address demographic shifts.
- A Chinese expert noted that there are clear historical examples of U.S.-China collaboration, such as during World War II, the Iran nuclear deal, in facing climate change, etc., but that the relationship has become increasingly strained.
- Several U.S. participants emphasized that both China and the United States are facing daunting trade deficit challenges, particularly when it comes to their debt-to-GDP ratio. They argued that this is an unsustainable trajectory for both countries.
- A U.S. expert suggested that the rise of populism and refugee crises around the world poses challenges not only for U.S. political and economic trajectory, but also for China’s ties with countries with which it is increasingly interdependent.
Subnational and National Cooperation
- Several Chinese and U.S. participants noted that the best way to balance between U.S. concerns over reciprocity and Chinese efforts to protect its domestic markets would be negotiation of a Bilateral Investment Treaty. One attendee noted the importance of understanding Donald Trump’s history as a real estate mogul and Xi Jinping’s own background to anticipate their next steps.
- A U.S. participant recommended that there are opportunities for the U.S. and China to imitate their bilateral progress on cyberspace norms to develop ones regarding the use of artificial intelligence in defense and to ameliorate the disruptive effects of technological change on domestic workforces.
- A U.S. expert suggested that caring for the health and wellbeing of China’s aging population will be an economic opportunity for companies to develop better healthcare services and biotechnology advances via joint ventures. A U.S. participant noted progress already made in the field of U.S.-China transportation.
- A U.S. attendee cited the demand of the emerging Chinese middle class for higher environmental standards as a pathway for entrepreneurism and government support for clean technologies. She noted that partnership in this arena could be expanded to protect the environment and to combat climate change.
- One Chinese participant suggested the need for expansion of travel, trade, and treaties between the two countries, such as through a bilateral visa waiver, free trade agreement and bilateral investment treaty. Another Chinese expert supported this idea, adding the importance of cultivating talent in all sectors that better understands China through travel or exchange programs.
A U.S. expert suggested that greater bilateral interaction and collaboration could be utilized to address issues that impact both countries, including a global rise of populism, migration and climate change. Another U.S. attendee noted that the Belt and Road Initiative could serve as a means of addressing some of these trends, including in the counterterrorism and security realm.