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发帖数: 5093 | 1 China’s Vice President Wang Qishan recently announced that Beijing is ready
to have discussions with the United States and “work for a solution” on
trade challenges. It sounds impressive, especially since President Xi
Jinping just made a similar pledge that China is ready to “advance an open
world economy.”
Unfortunately, we’ve heard this from Beijing literally hundreds of times
before. And nothing ever changes.
Here’s the bottom line: China remains the most protectionist nation on
earth. For years, Beijing has undervalued its currency, the yuan USDCNH, +0.
0130% , to lower the price of its exports. It dumps steel and other goods
on the world market at below the cost of production in order to put U.S.
manufacturers out of business. It funnels billions and billions of dollars
in shadowy subsidies and “loans” to its many state-owned enterprises. And,
it repeatedly hacks U.S. companies to steal their intellectual property.
China has benefited beyond its wildest dreams from the world’s openness.
And it has grotesquely abused the privileges that come with membership in
the World Trade Organization (WTO).
Of course, Xi and Wang are now making encouraging statements about open
markets and global trade. They want us to believe that things are going to
be “different” this time. Finally, their authoritarian regime wants to
dedicate itself to “supporting the multilateral trading system and
promoting free trade.”
But we’ve been down this road many times before, and Beijing has never
actually changed course.
In 2005, when the U.S. Senate moved forward on a bill targeting currency
manipulation, Beijing suddenly “untethered” the yuan from its longstanding
dollar peg. Ahead of a contentious G20 summit in 2010, Beijing quickly
adjusted the yuan’s exchange rate. And shortly before Vice President Joe
Biden’s visit to Beijing in 2011, China suddenly tweaked the value of the
yuan.
History repeats itself again.
Undoubtedly, President Donald Trump has brought a newfound vigilance and
assertiveness regarding China. And his steady stream of tariff actions has
finally caught Beijing’s attention. But the U.S. is still a long way from
coercing Beijing to stop its endless cheating and conniving.
What would the U.S. need to see, if China were to honestly and finally
change course? Beijing would need to fundamentally alter its approach on
trade: Immediately fulfill its WTO commitments — particularly on currency,
dumping, and subsidies; stop it’s state-owned economic, cyber, and military
aggression; and halt all of its intellectual-property theft and forced
technology transfer.
In short, Beijing needs to dismantle its entire “China 2025” focus on
predatory trade and global dominance, particularly in the world’s high-tech
sectors.
The good news is that Trump’s tariffs are starting to take a bite out of
China’s economy. A key manufacturing indicator for China, the country’s
purchasing managers’ index, reported slower manufacturing growth in October
for the second straight month. In fact, the October level was the lowest
for China since July 2016, and new export orders contracted for the fifth
straight month.
This kind of sustained economic pressure can give the U.S. important
leverage.
Ronald Reagan famously said, “Trust, but verify.” If China really wants to
prove that it can be an open, reliable partner, it’s time for Beijing to
make a major shift. But Trump should keep the pressure on — for many years,
if need be — to make sure that America doesn’t get conned again. There’s
simply no excuse to give Beijing room to keep taking advantage of the
United States and other countries that maintain free and open markets. |
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