January 23, 2022

Biden’s victory could make the US-China trade conflict more predictable

US Election 2020: Who Are Folks In China Backing, Trump Or Biden?

Biden's victory could make the US-China trade conflict more predictableBiden’s victory could make the US-China trade conflict more predictable

Trade tensions between Beijing and Washington may follow a predictable scenario after Joe Biden’s election victory. Presidential change is likely to herald a calmer rhetoric while maintaining a tough stance towards the Celestial Empire.

After several years of regular U.S. complaints about the unfair business practices of the Chinese government system, President Donald Trump stepped up pressure on Beijing with political measures. Ultimately, his administration imposed tariffs on billions of dollars of Chinese goods and through sanctions harmed Chinese telecom giant Huawei.

«The problems that remain in US-China trade relations will not go away with the change of administration. The pressure comes from both sides. Domestic policy does not allow to cede market positions to an opponent», – said Greg Gilligan, Chairman of the Beijing-based American Chamber of Commerce.

The two largest economies in the world signed a Phase 1 trade agreement in January, resulting in some pause in the conflict. However, critics point out that China is lagging behind in fulfilling agreed purchases of US goods, while negotiations for a Phase II deal have yet to begin..

Also not clear how the administration Joe Biden will deal with measures that hurt businesses in both countries after China responded to US restrictions with its own tariffs.

«Everyone should keep their powder dry. We have a long transitional road ahead of us to recover from the pandemic. We may see signs of a truce in the trade war, but it’s too early to analyze if tariffs or actions against Huawei will be lifted», – said Scott Kennedy, Senior Advisor and Chairman of the Board of Trustees for Chinese Business and Economics at the Center for Strategic and International Studies.

Analysts note that the new president’s administration will be able to work with US allies more effectively than Trump to pursue a more coherent strategy against China.. One of the few issues that Republicans and Democrats have agreed on is tightening of policy in relation to a country led by the Communist Party.

In his debut speech as president Biden says he will focus on fighting the coronavirus pandemic. Democrat didn’t say a word about China.

Biden agrees with the position «economic security is national security».

«The United States really needs to be tough with China», – he wrote earlier this year.

«If China gets its way, it will continue to rob the United States, steal American technology and intellectual property.. It will also continue to use subsidies to give its state-owned enterprises an unfair advantage in the technologies and industries of the future.», – believes Biden.

The President added that the most effective way to tackle this problem is to create a united front of US allies and partners to counter China’s violent behavior and human rights violations. 

There is growing hope on both sides of the Pacific that a more predictable foreign policy will provide more opportunities for business cooperation.

«Biden is sane. He understands the basics of dialogue», – said Xu Hongcai, Deputy Director of the Economic Policy Commission of the China Political Science Association.

Xu believes China can help the US develop infrastructure and international trade. He said Beijing is already working on issues such as the restructuring of state-owned companies, which have raised many questions from the United States during trade negotiations..

While the leaders of many countries (from Germany to the UAE) rushed congratulate Biden, PRC chairman Xi Jinping haven’t done it yet. Chinese leader called Trump the day after his election victory in 2016.

Trump refuses to admit defeat. His election campaign filed claims in several key states in an attempt to question election results.

Last week, before the election ended, China’s Deputy Foreign Minister Le Yucheng told reporters about the hope that the next US administration «will meet China halfway».