Enlightened Engagement: US-China Relations

Oval Office

It was Napoleon who said in 1803: “Let that sleeping giant sleep, for when he wakes up, he will shake the world.” Napoleon was, of course, referring to China. True enough, the rise (more correctly the renaissance) of China resulting from its remarkable, open-door economic structural reforms over the last thirty years has shaken the world. The U.S.-China relationship is probably the most important bilateral relationship in the 21st century. It is, however, a very broad, complex and multifaceted relationship. Managing a rising China effectively is therefore a huge challenge, but one that also presents an enormous opportunity for the United States.

Over the years, China has been variously labeled as America’s “partner,” “ally," “competitor,” “adversary,” and so on. The truth is that, at different times and depending on issues, all of these descriptions were correct. The conventional wisdom is that U.S.-China relations “can never be too good, or too bad.” In my view, there is now a unique window for the U.S. and China to progress beyond the status quo.

Economically, the U.S. and China are already interdependent. The two countries are the world’s largest mutual trading partners, and China is the largest holder of U.S. debt instruments. On major global issues including security, nuclear non-proliferation, environment and the reform of the international financial architecture, the U.S. and China have substantial common interests. It is important for the world’s number one and number two economies to deepen their mutual understanding and strengthen mutual trust. The current mechanism of the ‘U.S.-China Strategic and Economic Dialogue’ can be further strengthened by regional forums between U.S. and Chinese twin cities and states. Focusing on local dynamics and opportunities will stimulate Chinese interest for inward direct investments into the U.S., and therefore support job creation.

Change and new challenges

China itself is in transition. After 30 years of strong economic growth, a large middle class of more than 300 million has emerged, bringing with it many social and infrastructural challenges. The country has been evolving from an old-fashioned, centrally planned economy into a robust, competitive market economy, but with that has come a growing disparity between the haves and the have-nots. China has also been in transition from a governance system based on human relationships (‘the rule of man’) towards a system based on rules and regulations (‘the rule of law’).

The challenges to China from these transitional changes, in almost every aspect of daily life, have been phenomenal. As most of these challenges are domestic, China’s overriding priority going forward is to maintain social stability.

To achieve that, China has the desire (and the need) to build a strong and stable relationship with the U.S., its most important trading partner and counterpart. Externally, China has also been in transition from its historical role as a passive observer to become, hopefully, a more active and constructive player in world affairs. U.S. leaders, as well as think tanks and learned institutions, should position themselves as enlightened friends to support China’s growing role in global affairs. China’s willingness to play a responsible global role is very positive for U.S.-China relations.

Opportunity for engagement

We will soon know the outcome of China’s once-in-a-decade change of top political leadership. The new line-up is likely to include some of the most well-educated and proven leaders in modern China. They are likely to have a better understanding of the U.S. than their predecessors because either they have spent time in the U.S. themselves, or they have children who have been educated at top U.S. universities. They are also part of a generation which is at ease with U.S. culture and thinking.

This is a very good time for U.S. leaders to reach out and build long-term relationships with these incoming Chinese leaders, who could be in office for the next ten years. Recent events in China suggest that after thirty years of extensive economic reforms, political reforms may have to follow to sustain China’s desired peaceful rise and development. As friends, U.S. political leaders will be able to provide advice and support, and therefore a positive influence on the direction in which China may progress. Deeper and more active engagement with new Chinese leaders should be a strategic priority for your administration. 

Hopefully, we can now move away from often unhelpful domestic political rhetoric in the categorization of relations with China. If the United States is perceived as a friend, China is more likely to be receptive to U.S. advice and guidance in the management of its social and strategic changes. If the U.S. is not perceived as a friend, China’s rise will continue anyway, without the benefit of U.S. input.

In the longer term, the true nature of U.S.-China relations should be one of enlightened engagement. This means a genuine effort to focus on common interests as well as the ability to deal with differences with mutual respect and trust.

With this in mind, the following future steps should be considered:

Extension of the current top-level U.S.-China Strategic and Economic Dialogue to regional forums by encouraging, for example, twin (sister) states and cities to discuss and promote investments, technology cooperation, educational and cultural exchanges.

Strong support for U.S. think tanks and learned institutions (such as the Atlantic Council) to establish or expand their presence in China.

Strong support for the Chinese language to be widely taught in U.S. schools at all levels.

Strong support for expanding people-to-people exchange by, for example, relaxing visa requirements and expanding visa offices in China.

Incoming Chinese leaders are likely to be very interested and willing to increase and strengthen engagement with their U.S. counterparts. For the U.S. and China alike, this special window of opportunity to build an enlightened and sustainable bilateral relationship in their mutual interest, as well as in the interests of global stability, peace and prosperity, must not be allowed to pass.

Victor L.L. Chu is chairman of First Eastern Investment Group and a member of the Atlantic Council International Advisory Board. Chu has served as director and council member of the Hong Kong Stock Exchange, member of the Hong Kong Takeovers and Mergers Panel, Advisory Committee member of the Securities and Futures Commission, and part-time member of Hong Kong Government’s Central Policy Unit. This piece is taken from the Atlantic Council publication The Task Ahead: Memos for the Winner of the 2012 Presidential Election.

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