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A Shaky Detente

Amid the resumption of high-level talks between China and the US, the world’s two largest economies may drift further apart as tensions over technology, Taiwan and the South China Sea continue to intensify

By Yu Xiaodong Updated Oct.1

US President Joe Biden signed a long-anticipated executive order on August 9, restricting US-based investments in Chinese entities in three sectors, including semiconductors and microelectronics, quantum information technologies and artificial intelligence systems.  

The move adds to sweeping rules the US announced in the past year that aim to cut off high-tech semiconductor tool exports to China, while the US rallied key chip-making allies such as Japan and the Netherlands to do the same.  

China countered in July by restricting exports of gallium and germanium, two metals key to the manufacturing of semiconductors. The decision, which took effect on August 1, requires exporters to seek a license to ship some gallium and germanium compounds.  

Biden’s executive order, which observers described as “unprecedented,” marks a significant escalation of the US’s technology war against China, which has expanded from export controls to investment restrictions.  

On August 10, China’s Foreign Affairs Ministry lashed out at the US’s decision. Calling it an act of “blatant economic coercion and technological bullying,” it said that China reserves the right to take countermeasures. 

High-Level Exchanges 
It is notable that the Biden administration’s latest move to ban US investment in China’s high-tech sector came despite recent concentrated high-level exchanges between the two countries. 

China suspended high-level defense communication mechanisms and other high-level dialogues with the US in response to the controversial visit of former US House Speaker Nancy Pelosi to Taiwan last August. Since then, the US has repeatedly called for the resumption of high-level defense talks, arguing that it is imperative for the two sides to establish “guardrails” to prevent inadvertent military clashes and crises, while other serving US officials have voiced their interest or intent to visit China.  

China insists that the US must lift the sanctions it imposed on China’s Defense Minister Li Shangfu in 2018 over China’s purchase of Russian arms that year before high-level bilateral defense talks can resume, but agreed to restore high-level exchanges in other areas.  

On May 25 and 26 during his visit to the US for the APEC Ministers Responsible for Trade Meeting 2023, Chinese Commerce Minister Wang Wentao met with US Commerce Secretary Gina Raimondo and US Trade Representative Katherine Tai. They agreed to establish channels of communication. On June 18 and 19, US Secretary of State Antony Blinken visited China, meeting with Chinese President Xi Jinping and other top officials. In early July, US Treasury Secretary Janet Yellen visited China. She was followed by US climate envoy John Kerry, who visited China between July 16 and 19. Media reports suggest that Raimondo could be the next cabinet member of the Biden administration to visit China.  

Given the strained relationship between the two countries, few observers expected that these exchanges, which typically featured “candid and constructive” talks according to readouts of both sides, would lead to breakthroughs on any concrete issues. They did not. But most analysts believe high-level talks could inject some certainties and result in a stable detente between the two countries. Washington’s recent moves indicate that the downward spiral of the US-China rivalry is far from over. 

Chinese President Xi Jinping meets with US Secretary of State Antony Blinken, Beijing, June 19, 2023 (Photo by Xinhua)

Chinese Premier Li Qiang meets with visiting US Treasury Secretary Janet Yellen, Beijing, July 7, 2023 (Photo by CNS)

‘Dual Tactics’ 
For many Chinese experts, the recent round of high-level talks between the US and China, mostly sought by Washington, suggests tactical adjustments to its strategy toward China rather than a policy change.  

“The US’s emphasis on dialogue is not driven by a genuine intention to stabilize the bilateral relationship,” said Professor Li Haidong, Director of the Center for American Studies at China Foreign Affairs University. “It’s more about offering a new pretense to pursue the same objective [of containing China],” he told NewsChina.  

Li said the reason behind Washington’s emphasis on dialogue in recent months stems from the unpopularity of its policy of “decoupling” from China among its allies and the rest of the world. As a result, the Biden administration has adjusted its tactics. And by coercing China to conduct high-level dialogues, the US is seeking to normalize its containment policy against China so it can exert more influence on other nations to join its anti-China strategy.  

Senior US officials’ rhetoric, like Blinken’s pledge that “the US does not seek a new Cold War with China” and Yellen’s comments that “the US does not see the relationship between the US and China through the frame of great power conflict” are just lip service, Li said.  

“By manipulating certain issues, including repeatedly raising the issue of communication and dialogue, the purpose of the US is to gain a more advantageous position so it can exert greater influence over other countries,” Li added.  

According to Professor Wang Hong-gang, Vice President of the China Institutes of Contemporary International Relations (CICIR) and Director of the CICIR Institute of American Studies, the Biden administration’s recent moves indicate that the US has adopted “new dual tactics” of “competition+competition management.”  

In a commentary published in the Chinese version of chinausfocus.com, an opinion-focused website, on August 10, Wang argued that in the decades since the establishment of diplomatic relations between the US and China, the US has adopted a dual strategy of “engagement+control.”  

According to Wang, the US actively sought to integrate China into the international system and broaden cooperation. Yet it also quietly advanced measures to infiltrate China and limit China’s global influence. Wang said this duality is aimed at maintaining a balance between cooperation and containment in the US-China relationship, which is why the bilateral relationship has been very complex.  

“Competition” is the core component of the US’s new approach towards China. Under the Trump administration, the US sought to achieve a swift victory over China, but failed to do so. The Biden administration has opted for a long-term strategy of competition. In doing so, Washington emphasized the importance of “competition management,” which Wang said is not an uncommon strategy in the history of great power competition over the past few centuries, including the US-Soviet Cold War.  

“It serves several purposes. First, it sends mixed signals to cause confusion and increases the opponent’s difficulty in properly assessing the situation. Second, it demonstrates ‘self-restraint’ to prevent excessive reactions from the opponent. Third, it reserves a ‘dialogue window’ to seek limited cooperation from the opponent,” Wang said.  

Wang maintained that concepts raised by US officials like “guardrails,” “parameters” and “bottom-line,” along with Washington’s recent use of “derisking,” rather than “decoupling,” all fall within the realms of the strategy of competition management, “which is primarily tactical and serves the purpose of enabling effective ‘competition.’” 

This handout photo taken on June 3, 2023 by the US Navy shows the Arleigh Burke-class guided-missile destroyer USS Chung-Hoon being observed by the Chinese PLA Navy vessel Luyang III (top) while on a transit through the Taiwan Strait with the Royal Canadian Navy’s HMCS Montreal (Photo by VCG)

Deteriorating Ties 
Amid the disputes over Washington’s investment ban, the Taiwan question, which China considers its “core of core interests” and which caused the suspension of high-level talks between the US and China last year, returned to center stage.  

After announcing a new weapons aid package to Taiwan worth up to US$345 million on July 28, Biden signed into law on August 7 the “US-Taiwan Initiative on 21st-Century Trade First Agreement Implementation Act,” which aims to eventually negotiate and reach a trade agreement between the US and the Taiwan region.  

The US also allowed Lai Ching-te, Taiwan’s deputy leader and a self-claimed “separatist” who is the current front-runner in the island’s general election scheduled in January next year, to make two stopovers in New York and San Francisco on his way to and from Paraguay on August 12 and August 16.  

China’s Foreign Affairs Ministry said on August 10 that Washington’s move violates the three China-US joint communiqués which serve as the political foundation of the China-US relationship and contravenes the US’s own commitment of maintaining only unofficial relations with the Taiwan region, which includes not negotiating or signing any agreement with an implication of sovereignty or of an official nature.  

In the meantime, tensions are simmering in the South China Sea as Washington vowed support for the Philippines after China’s Coast Guard blocked Philippine military supply boats carrying building materials on August 6 to an atoll known as Ren’ai Reef in China and Second Thomas Shoal or Ayungin Shoal in the Philippines, which is claimed by both sides. 

Further Talks? 
The rising tension has dimmed the prospects of further high-level exchanges between the two countries, including a potential visit of Chinese Foreign Minister Wang Yi to the US and a possible meeting between Chinese President Xi Jinping and Biden during the G20 summit in New Delhi, India in September.  

The US State Department said on August 1 that it has formally invited Wang Yi to visit the US, though the two sides have not confirmed a date. China responded on August 3 that it is “willing to maintain communications” with the US on such a visit, without confirming whether Wang had accepted the invitation.  

It is no secret that recent high-level exchanges between the US and China have been more actively sought after by the US. Although China agreed to host various visiting senior US officials, it has only shown lukewarm enthusiasm toward these talks, which prompted Washington to complain that 100-year-old Henry Kissinger had more meetings in China than sitting US officials.  

China rolled out the red carpet for the former diplomat, known to be an architect of the normalization of the diplomatic relationship between the US and China in the late 1970s. During his visit to China on July 20, Xi met with Kissinger, referring to him as “an old friend” of China. 

China has long insisted that high-level exchanges are not without conditions. During Yellen’s visit to China in July, China laid out four lists of issues and concerns that China requested the US to address – “the list of US wrongdoings that must stop, the list of key individual cases that the US must resolve, the list of Acts in the 117th Congress of high concern to China, and the list of cooperation proposals in eight areas, which the Chinese side hopes will be taken seriously by the US side.”  

During a meeting with Blinken on July 13 in Jakarta, Indonesia, Wang Yi again urged the US to turn its pledges into concrete actions to “remove obstacles, both expected and unexpected, to accumulate momentum for a stable China-US relationship.”  

Just as Blinken said during her China trip that the US will “continue to say and do what China does not like,” Washington’s recent moves show clearly that it has no intentions to change its approach to China.  

In the high-profile trilateral summit held between US President Joe Biden, Japanese Prime Minister Fumio Kishida and South Korean President Yoon Suk -yeol at Camp David in Maryland on August 18, the three countries signed agreements including a multiyear military exercise plan, deeper coordination on ballistic missile defense and the establishment of a new crisis-communication hotline. Turning this first-ever trilateral summit into an annual event, the mechanism is widely considered as targeted at China, with some observers warning that it could be the first step to establish an Asian NATO. In a joint statement, the three countries said they “strongly oppose any unilateral attempts to change the status quo in the waters of the Indo-Pacific,” while urging “stability across the Taiwan Strait.”  

China’s Foreign Affairs Ministry spokesperson Wang Wenbin responded on the same day that “the international community has its fair judgment on who is stoking conflicts and exacerbating tensions.” Accusing the US and its allies of turning the region “into a wrestling ground for geopolitical competition again,” Wang said “Attempts to cobble together various exclusionary groupings and bring bloc confrontation and military blocs into the Asia-Pacific are not going to get support and will only be met with vigilance and opposition from regional countries.  

It appears that the two countries are so entrenched in their positions on certain issues that even if high-level talks continue, it would be insufficient to stabilize the bilateral relationship.  

“Even if there are signs of easing tensions in the latter half of 2023, it won’t be due to a change in US policy, but because of China’s growing capability to reshape the dynamics of the China-US relationship,” Li Handong said.  

Wang Honggang warned, “China must be prepared to face serious challenges posed by tumultuous and even stormy waters.”