Trump visit to China offers test of mutual opening up, willingness to negotiate

By Hu Weijia Source:Global Times Published: 2017/10/30 22:08:41

Representatives from about 40 companies have reportedly been selected to accompany US President Donald Trump on his first visit as president to Beijing next month and sign deals for billions of US dollars in US investments. Although some analysts have forecast that Trump will press China on trade, economic relations will remain a positive force in ties.

With the Belt and Road initiative, China's outbound investment is increasingly flowing into ASEAN countries and Central Asia, but according to the American Enterprise Institute (AEI), the leading recipient of large Chinese investments, excluding bonds, is still the US, which "received over $160 billion between January 2005 and June 2017."

It is important for the US to build a positive, comprehensive relationship with China, which shares this desire. In recent years, investment between the two countries has evolved into a two-way street, with strengthened interconnection between the world's two largest economies.

For the US, China is becoming more important, which is an inevitable result of China's economic development. Economic relations create a firm foundation for bilateral ties. This can hardly be changed by Trump's trade rhetoric.

However, observers have noted that industrial competition has recently become a common problem faced by the two economies, which is also a result of China's rise. According to media reports, companies in the energy and commodity sectors, rather than high-technology industries, will make up a major part of the business delegation visiting Beijing next week. This doesn't mean companies in the technology industry are being neglected, but it does reflect that more intense competition will be seen between the two countries in that sector. China's Internet giants are growing even faster than their US counterparts and aim to increase their presence in the US.

China and the US have been negotiating a bilateral investment treaty (BIT) for years, aiming to give companies in both countries better access to each other's market. The treaty has the potential to be a win-win agreement, but negotiations on the BIT have not gone smoothly. Sino-US economic relations have become increasingly complicated and uneven, just as the two countries begin to sit at the negotiating table. It's normal that each side would seek the maximum advantage for its domestic companies. This means a serious test of reciprocal opening-up, negotiating skills and even patience.

However, the two countries have no choice but to enhance cooperation. In this context, even slight progress will be a valuable achievement.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn



Posted in: EYE ON THE ECONOMY

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