Economic aggression? Not from China!

By Li Hong Source:Global Times Published: 2017/12/26 21:18:40

Illustration: Peter C. Espina/GT


A couple of years ago, when Chinese real estate mogul Wang Jianlin proposed to acquire a substantial stake in Paramount Studios and other entertainment assets in Hollywood, many US congressmen were irked and demanded that the Committee on Foreign Investment in the US scrutinize all Chinese investments in the US in a disguised attempt to protect so-called national security.

Since then, Chinese investment in the US has subsided by a considerable scale, even though common sense shows that, in any modern economy, investment is the surest path to create jobs and growth. 

In Washington, some politicians always claim that China might be making use of its deep pockets to advance "economic aggression" against the US, a term that has just appeared in the Trump administration's new National Security Strategy (NSS), which, to the chagrin of many, lists China as a strategic rival.

In sharp contrast, China has always welcomed foreign investment. Since the reform and opening-up in 1978, a slew of US corporations including famous names like GM, Ford, Apple, Microsoft, IBM, Disney and Uber (and thousands more) have invested in the country, to explore the rapidly growing market of Chinese consumers.

China knows well that foreign investment has contributed greatly to its booming economy.

China's central government has announced plans to allow foreign businesses to invest significantly in China's financial sector, as it promised to open its doors wider. As the nation stands firm in supporting economic globalization and shared prosperity for all people on the planet, it is bizarre for China to consider investment by any foreign country to be the same as launching "economic aggression" against it.

In releasing the NSS, US President Donald Trump said in a speech at the White House that "great power competition" had returned and could only be faced down by a relentless "America First" approach, presumably under his watch. He vowed to hold back challenges from "revisionist powers" like China, which he said tries to rewrite global rules.  Trump even went so far as to remark that "unrivaled power is the most certain means of defense."

The definition of China as a strategic rival instead of a cooperative partner has baffled many in this country, with some analysts worrying that the two economic powers may be perilously near to a collision course.

Not necessarily, others claim, because the two economies are so closely intertwined. Any drastic change of policy is certain to cause economic tremors and deal a disastrous blow to both economies.

In the light of the new NSS, the Trump administration is expected to place more emphasis on pressuring China in order to seek more concessions. Small concessions are possible and would be mostly reciprocal following negotiations in good will regarding investment and trade, pundits point out, but China surely has drawn its bottom line.

Some in China have said that Washington's anxiety is rooted in China's meteoric growth in the past three decades, after the country was ushered into a market-oriented economic development path. Once tens of millions of people were inspired to seek prosperity through innovation and hard work, it is natural that the country's growth became both phenomenal and unstoppable.

Many in the West, the US in particular, prefer to think that China is a Third World country that churns out low-end products. This is no longer the case. The country has become a de facto manufacturing power, perhaps having climbed to the same technology level as the US.

Now, China is leading in new-energy exploration including solar plants and wind turbines, in the Internet and telecommunications sectors including fourth-generation coverage and mobile payments, and in infrastructure construction including roads, bridges and high-speed railways. In defense technology, it is catching up quickly.

In addition, China has begun to extend a helping hand to the needy, its poverty-stricken neighbors in particular.

While most countries have welcomed the influx of Chinese capital and technology, particularly in line with the China-proposed Belt and Road (B&R) initiative that keeps upgrading their infrastructure and boosting their local economies, politicians in the US and a few other economies (notably India) are unimpressed.

As always, these countries' politicians are suspicious of China's moves. They do their utmost to keep China's investments at arm's length. The ideologists standing in their shadow claim Chinese businesses' rapidly growing investments abroad are driven by Beijing's encouragement to its companies to take control of foreign markets, and looser restrictions on Chinese capital by host governments are also to blame.

Their suspicions are truly laughable, provided their own worn-out roads, ports, bridges and railways are creaking and in urgent need of repair.

A reminder is that earlier this month, an aged Amtrak passenger train heading from Seattle to Portland veered off an interstate highway overpass, killing at least six and injuring dozens more.

At about the same time, a high-speed railway, linking Xi'an in Northwest China's Shaanxi Province and Chengdu in Southwest China's Sichuan Province, was completed, shortening the previous 16-hour trip to three hours. The railway is expected to inject new impetus into local economies all along the line.

Chinese people used to react with strong disbelief, after seeing that the US had tried to shut the door on Chinese technology, investment and trade. Now most of them just shrug their shoulders.

Experts claim that we have to wait for a decade or two before a group of much smarter politicians are sitting on Capitol Hill and in the White House, before the US will extend its hand of faithful cooperation to China. Until then, we can anticipate more brawls on the other side of the Pacific.

The author is an editor with the Global Times.


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