Tue. Dec 6th, 2022

Prof. ST Hsieh

Director, US-China Energy Industry Forum

626-376-7460

[email protected]

November 9, 2022

It is an interesting and dangerous time that the west is ready to “engage” China again. But western nations are either naïve or self-centered.

  1. Unfortunately, as Canada realized that “Ottawa was investing to better understand how “China thinks, operates and plans.” To do that, Canada will spend C$50 million ($37 million) to bolster its network of China experts in embassies.” This is a major problem for the west, they just do not understand China. However, the only way to understand China is to be in China and learn from Chinese.
  2. It is most likely too late and too little for Canada to “better understand China” now. Because Canada has already characterized “China was an “increasingly disruptive, global power.” So, what do Canadians expect from China: friend or foe? In the same breath, Canadians say “It’s sheer size and influence makes cooperation necessary.” Do Canadians realize their own size and influence as viewed by the Chinese? Will Xi meet with Justin Trudeau anytime soon?
  3. The Biden approach to China is constrained by the same logic: China is an important trade partners so US and China must trade, but only under the US terms! It is wishful thinking that “while the U.S. sees China as a competitor and rival, the countries should still be able to communicate and, where possible, cooperate on areas of mutual interest.” Clearly, China will read into “mutual interest” means US interest only. Further, the Biden administration keeps sending self-conflicting messages toward China. The problem is that Biden’s approach to China does not command the support of the majority. His balancing act to appease politicians and businessmen fails miserably.
  4. Australia falls into the same category of Canada in terms of relative national power with respect to China. Albanese said the right phrase that “it would be positive if meeting arranged with China’s Xi,” but any meeting will have to wait till Australia does something to impress Xi.

It is simply the brutal reality of geopolitics!

Cooperative rivals: Biden seeks novel relationship with China

Ned Temko Wed, November 9, 2022 at 5:56 AM

Here’s a phrase I never expected to write: Joe Biden will be spending the next few days channeling his inner Gwyneth Paltrow.

It was Ms. Paltrow who popularized the phrase “conscious uncoupling” to describe the careful unwinding of her 12-year marriage to British rock star Chris Martin, with the aim of avoiding collateral damage to each other, their family, and friends.

But it might well apply now to the U.S. president, who is due to meet Chinese leader Xi Jinping for the first time next week, as Mr. Biden begins the delicate task of recalibrating Washington’s relationship with Beijing at the most consequential summit of his presidency.

The meeting, at the G-20 summit on the Indonesian island of Bali, comes at a critical juncture. After decades of increasingly intertwined trade ties, China has emerged as America’s main economic, political, and security rival.

Mr. Biden will be hoping that despite this rivalry, both sides will recognize that a bitter, chaotic divorce – the geopolitical equivalent of sulking and shouting, slamming doors, and throwing dinner plates – is in neither nation’s interest.

Since the earliest days of his presidency, Mr. Biden has made clear the political understanding on which he wants to build future ties with Beijing: that while the U.S. sees China as a competitor and rival, the countries should still be able to communicate and, where possible, cooperate on areas of mutual interest.

This approach has had mixed results so far. Washington has not found China ready to engage with it on climate policy. But on the other hand, Beijing has largely refrained from helping Moscow evade Western sanctions.

Meanwhile, an “unconscious uncoupling” has already begun – the result of a range of political and economic factors in both China and the West.

In China, Mr. Xi has sidelined figures associated with the country’s economic reform and opening to the outside world. He is focusing instead on economic self-sufficiency, especially in high-tech areas, and the projection of Chinese power abroad.

He’s also imposed a “zero-COVID” policy with lockdowns and mandatory testing for millions of Chinese citizens across the country. That has contributed to a serious slowdown in China’s economy. It has also upended the supply chains on which major businesses in America and other Western countries have come to rely.

That has been a stark reminder of the degree to which Western economies have come to depend on China. The price that Europe is now paying for its reliance on oil and gas from another autocratic regime, in Moscow, has further highlighted the risks of such an approach.

Still, unwinding reliance may prove complicated for a number of governments.

Germany’s Chancellor Olaf Scholz faced criticism not only from fellow European Union states, but his own Cabinet and security services, for flying to China last week to meet Mr. Xi. The reason he went: the importance for Germany’s automobile industry of sales in China.

Australia has no doubt about the security challenge Mr. Xi’s China poses for its Asian neighbors: It has decided to base nuclear-capable U.S. bombers on its territory. Still, despite punitive Chinese tariffs on a range of Australian goods, exports to China remain key to its economy.

The conundrum facing Mr. Biden is that both the U.S. and the wider world economy could suffer significantly from an across-the-board uncoupling. Washington is determined to impose stricter national security criteria on its trade with China. How can it do this without threatening the whole edifice of a trade relationship worth $655 billion a year, and thus damaging an already fragile economy?

Mr. Biden recently set new rules barring the sale to China of advanced microchips and chip-making technology. His aim is unequivocal: to frustrate Mr. Xi’s campaign to catch up with, and then outpace, the U.S. in high-tech innovation.

Still, in explaining the new restrictions, Alan Estevez, a senior Commerce Department official, added a dash of Gwyneth Paltrow-like consciousness. The aim was not, he said, to hold back China’s economy, nor to undermine the U.S.-China trade relationship.

At the same time, Mr. Estevez does not appear to foresee a very sophisticated future for the Chinese microchip industry. He had “no problem,” he said, with China retaining “a robust capability to make semiconductors to go into the airbags of cars.”

That is unlikely to impress Xi Jinping.

Canada readies new Indo-Pacific strategy amid tense China ties

Wed, November 9, 2022 at 11:25 AM

OTTAWA (Reuters) – Canada will soon announce a new Indo-Pacific strategy to challenge China on human rights issues while cooperating with the world’s second-biggest economy on climate change and other shared goals, Foreign Minister Melanie Joly said on Wednesday.

China was an “increasingly disruptive, global power” Joly said, and would need to be a major part of the Indo-Pacific strategy expected to be announced within the next month.

Diplomatic tensions between Canada and China have been running high since the detention of Huawei Technologies executive Meng Wanzhou in 2018 and Beijing’s subsequent arrest of two Canadians on spying charges.

While the standoff ended when all three people were released last year, relations have remained sour. Citing national security concerns, Ottawa banned the use of 5G gear from Huawei in May and last week, ordered three Chinese companies to divest from critical minerals in Canada.

This week Beijing pushed back against Prime Minister Justin Trudeau’s accusations that China was attempting to interfere with Canadian elections and said Ottawa should stop making remarks that hurt relations.

Canada would stay firm on issues surrounding Taiwan and reported human rights violations in Xinjiang region.

“It’s sheer size and influence makes cooperation necessary to address the world’s existential pressures such as global health, nuclear non-proliferation, climate change and biodiversity loss,” Joly said.

She said Ottawa was investing to better understand how “China thinks, operates and plans.” To do that, Canada will spend C$50 million ($37 million) to bolster its network of China experts in embassies, a source close to the matter told Reuters.

Joly warned that there were risks of doing business with China, telling Canadians, “you need to be clear-eyed. The decisions you take as business people are your own.”

Business groups welcomed the plans.

The Canadian Chamber of Commerce said the region holds “great potential for Canada,” and that businesses planned to work with government to build on their economic activities in the Indo-Pacific.

Australia’s Albanese says it would be positive if meeting arranged with China’s Xi

Alasdair Pal

Tue, November 8, 2022 at 4:15 PM

By Alasdair Pal

SYDNEY (Reuters) -Australia Prime Minister Anthony Albanese said on Wednesday a meeting with China’s President Xi Jinping it would be a positive development after years of strained relations between the two countries.

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