An article in the Chinese regime’s ideological journal has set the tone for the upcoming trade talks between Chinese leader Xi Jinping and U.S. President Donald Trump during the G20 Summit next week. If this article truly conveys Xi’s intentions, it’s almost 100 percent certain that the two leaders will not reach any agreement.
The lengthy editorial on the U.S.-China trade war in the June issue of Qiushi has ten sections and took up two full pages when People’s Daily republished it on June 17.
As Qiushi represents the most important policy decisions from the Central Committee of the Chinese Communist Party (CCP), this article has basically set the guideline for Xi’s attitude in his upcoming meeting with Trump at the G20 Summit in Japan.
In addition to Beijing’s usual clichés and rhetoric when referring to the trade dispute, such as blaming the United States for bullying China in trade negotiations and declaring that China will never give in, this article predicts that the United States will be more and more “isolated” in the international community as it keeps challenging and breaking international rules, while China will be able to turn the “crisis” into “opportunities.”
In a section titled “China’s Position and Attitudes Towards Sino-U.S. Trade and Economic Frictions,” the article claims that the fundamental difference between the United States and China is that the former is taking the “old road of hegemony” and the latter the “new path of building a community of common destiny for mankind.”
If this Qiushi article conveys Xi’s true intentions, we can be 100 percent sure that, if the two leaders meet, they will not reach any agreement.
However, if the article represents the intentions of the hardliners within the party or the faction of former party leader Jiang Zemin, then it’s their intention to set a guideline and boundary for the upcoming Trump-Xi talks.
So far, Xi has been cooperating with these hardliners, which has placed himself in a perilous situation. If he fails to break through these barriers and fails to achieve reform or to honor the previous promises he made to the United States, [with another round of U.S. tariffs threatening the Chinese economy], even Xi’s own survival will be at risk.
China’s Economic Crisis
The editorial, however, boasts about China’s economy, saying that China’s economic miracle is the result of “successfully combining socialism with market economy.” Therefore, “China is confident and capable of handling any economic challenges and risks,” it states.
But in actuality, under the pressure of this trade war, China’s economic development has fully revealed its aberrant nature. The Trump administration has many cards it can play in this trade war, yet it has been able to deal a heavy blow to China’s economy by merely imposing tariffs and by banning Huawei and ZTE.
In recent months, China’s export and import have both dropped sharply. China’s stock market was hit by the biggest outflow of foreign capital. A large number of private enterprises have shut down or have moved to Southeast Asia. The unemployment rate has reached a new high. Food prices are soaring. China’s currency, the yuan or renminbi, is facing the pressure of substantial devaluation.
The six stabilities that Xi called for in July 2018—stable employment, stable finance, stable foreign trade, stable foreign investment, stable investment, and stable expectations—are all unstable at present. Even communist officials are making preparations for the demise of the CCP by moving both their assets and their families overseas.
Sun Liping, a professor of sociology at Tsinghua University and Xi’s former mentor, published an article last year on the Chinese social media platform WeChat about the trade war.
He straightforwardly stated that China cannot afford to fight back, because “China heavily relies on imports, such as advanced technology products, from the United States. China’s foreign currency exchange mostly comes from the United States. Without this foreign exchange, necessities like food, oil, and microchips cannot be imported.”
As for the United States, Sun explained that it has natural resources within its own borders that sustain the country’s people. In addition, it has many allies around the world that can provide markets even if the Chinese market disappears.
“But China cannot afford that,” Sun said.
“If the trade war took a turn for the worse, it would at most seriously harm the U.S. economy,” he pointed out. “But for China, it’s an issue of survival.”
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Author: Zhou Xiaohui
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