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The Case for Sustained Sino-US Engagement
DATE:  Sep 27 2021
/ SOURCE:  Yicai
The Case for Sustained Sino-US Engagement The Case for Sustained Sino-US Engagement

(Yicai Global) Sept. 27 -- Presidents Biden and Xi had a phone call earlier this month. The official readouts suggest its tone was more congenial than their first conversation seven months earlier.

In February, President Biden had underscored his “fundamental concerns about Beijing’s coercive and unfair economic practices, crackdown in Hong Kong, human rights abuses in Xinjiang, and increasingly assertive actions in the region, including toward Taiwan.” President Xi responded that the “Taiwan question and issues relating to Hong Kong, Xinjiang, etc. are China's internal affairs and concern China's sovereignty and territorial integrity, and the US side should respect China's core interests and act prudently.”

In contrast, the White House characterized this month’s call as “a broad, strategic discussion” during which the leaders discussed areas where their interests converged and those where their interests, values, and perspectives diverged. Similarly, the Chinese Ministry of Foreign Affairs reported that based on “respecting each other's core concerns and properly managing differences” the US and China could cooperate on issues such as climate change, COVID-19 and the economic recovery.

It is likely that the Presidents’ September phone call spurred the US Justice Department to allow the release of Meng Wanzhou late last week. The resolution of Ms. Meng’s case removes a major stumbling block in Sino-US relations.

Ms. Meng’s release and the more constructive nature of the President’s September conversation are further signs of a warming in the two countries’ relations. This friendlier trend began in June with Vice Premier Liu He’s calls to Treasury Secretary Janet Yellen and Trade Representative Katherine Tai. It continued in July, when Deputy Secretary of State Wendy Sherman met with State Councillor and Foreign Minister Wang Yi in Tianjin. Indeed, during this meeting, the Chinese side asked the US to unconditionally drop the request to extradite Ms. Meng.

While recent events are certainly good news for China, the US and the rest of the world, one US think tank believes that regular, enhanced engagement is required to help manage cooperation, competition and confrontation between the world’s two largest powers. Earlier this month, the National Committee on American Foreign Policy published a report entitled Engagement Revisited: Progress Made and Lessons Learned from the US-China Strategic and Economic Dialogue.  The Report is an evidence-based exercise that reviews the experience of the US-China Strategic & Economic Dialogue (S&ED). It focuses on the “significant benefits” the US gained from the Obama administration’s flagship engagement process. It was written to convince US policymakers of the value of re-establishing regular, authoritative and robust channels of communication with China.

The S&ED consisted of annual cabinet-level meetings between American and Chinese policymakers. It followed on the George W. Bush Administration’s Strategic Economic Dialogue, which had been managed, on the US side, by the Treasury Department and which was narrowly focused on economic relations. Under President Obama, the Department of State was formally added as a co-convener and the range of issues covered was broadened.

To evaluate the effectiveness of the S&ED, the Report reviewed the 967 statements of outcomes produced between 2010 and 2016. In addition, its authors spoke both on- and off-the-record with former US officials who had worked on the S&ED. The Report is detailed and informative and I commend it to you. I want to summarize some of its key points here to illustrate the benefits of continuous structured dialogue as seen from the perspective of an American think tank. 

The Report places a lot of value on the S&ED’s process: the regular, ongoing nature of the high-level meetings. The authors describe it as a “pressure release for disputed issues” that might arise in other aspects of US-China relations. Because of the S&ED’s size and scope, the process was likely to continue in the face of particular points of contention. This forced both sides to come to the table and manage the difficult issue at hand. Indeed, as one former US official noted, there are some issues that cannot be solved, only managed.

The Report also characterized the S&ED as a “risk-reduction mechanism” since it allowed the American and Chinese sides to better understand each other’s systems and the barriers to progress. This helped deescalate rhetoric and provide the space to find concrete solutions.

Participants interviewed for the Report also emphasized the S&ED’s role in building relationships between officials on both sides.

There were many areas in which the S&ED led to concrete positive outcomes.

In the wake of the Global Financial Crisis, China and the US committed to rebalancing their economies to reinforce global macroeconomic stability. China increased domestic consumption from 49 to 55 percent of GDP by the end of the S&ED. At the same time, the US cut deficit spending by almost two-thirds. Such cooperation helped underpin the recovery and reduced the risks associated with “global imbalances”.

The S&ED led to many important outcomes concerning climate change and the environment. Through information and experience sharing, it facilitated China’s accession to the Paris Agreement. In the 2011S&ED, the US and China committed to work together in regional fisheries management. At the 2012 S&ED, the US and China agreed to strengthen cooperation through the Asia-Pacific Network for Sustainable Forest Management and Rehabilitation, a regional initiative led by China and adopted by APEC. In the 2014 S&ED, China announced that it would improve vehicle emission standards. These standards were informed by expertise shared by the US. The S&ED helped establish the Clean Energy Research Center, a public-private partnership on clean energy research and development. The US and China also successfully cooperated to improve the effectiveness of marine protected areas.

The S&ED led to advances in public health management. The US and China offered a coordinated response to the African Ebola crisis in 2014. The cooperation advanced, culminating in a joint project, in partnership with the African Union, to establish an Africa Center for Disease Control that was officially launched in January 2017. Americans provided expertise for the institution, while the Chinese constructed the physical infrastructure.

One can only imagine that more robust bilateral communication and collaboration might have contributed to a more effective response to COVID-19. However, at the time of the outbreak, the Trump Administration had reduced or eliminated many of the China-US cooperation mechanisms. The US’s Center for Disease Control’s program in China had been significantly downsized and its epidemic prevention activities, established following the Ebola outbreak, had been slashed in 2019.

Finally, the S&ED contributed to outcomes for security and law enforcement. China and the US cooperated to bust child pornography rings and control the cross-border flow of narcotics. A memorandum of understanding was signed that helped verify the identities of illegal immigrants in the US. The program to reduce potential collisions in space appears to be particularly instructive. Prior to 2014, NASA’s only communication with its Chinese counterparts was via fax. As the Reports notes, this was hardly the recipe for a swift resolution of impending space disasters. Over time, a direct link was established between the US Joint Space Operations Center and the Beijing Institute for Telecommunications and Tracking. And today there is a regular and routine process for sharing collision avoidance notifications.

Given the extensive ties between China and the US, the Report says that the future prosperity of both countries – and the world – depends on the evolution of bilateral relations. The strategic question is how to, not whether to engage. The research presented in the Report argues that “regular and routine” processes for information sharing and cooperation will yield the biggest benefits.

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Keywords:   US-China Strategic & Economic Dialogue,Meng Wanzhou,climate change,public health management,global macroeconomic stability,security and law enforcement,China-US cooperation
Mark KrugerMark KrugerMark Kruger is Yicai Global's Opinion Editor and Senior fellow to the Yicai Research Institute. He is also a Senior Fellow at both the University of Alberta's China Institute and the Centre for International Governance Innovation. Mark was formerly a Senior Policy Director in the Bank of Canada's International Department, a Senior Advisor to the Canadian Executive Director at the International Monetary Fund and head of the Economic and Financial Section in the Canadian Embassy in Beijing.