A US-China trade deal does not slow China’s rise

USA Mar 05, 2019, 10.05 AM(IST) Written By: The Conversation

File photo of US-China flag. Photograph:( Reuters )

Story highlights

America may have missed a window of opportunity to curb China’s rise when it pulled out of the Trans-Pacific Partnership (TPP).

By James L Anderson

The original March 1 deadline has passed as the United States and China hash out a trade deal amid deadlocked negotiations.

Any US-China trade deal likely falls short compared to what the Trans-Pacific Partnership (TPP) could have been.

Within current talks, Donald Trump’s administration is focused on greater access to subsidised Chinese industries and addressing intellectual property theft linked to alleged forced technology transfers to China. All of this has an impact on America’s economic competitiveness in the short term.

But is the US adequately managing long-term Chinese efforts to don the mantle of global leader?

On the third day of his administration in 2017, Trump honoured a campaign promise by withdrawing from the contentious TPP. The historic 12-nation agreement was on track to cover roughly 40 per cent of the global economy.

Democrats and some Republicans in Congress, advocacy groups and some members of the American public flatly opposed the agreement. Concerns about the oversized influence of multinational corporations and the controversial investor-state dispute process was a feature of the public discourse.

Lost opportunity to rein in China?

But America may have missed a window of opportunity to curb China’s rise when it pulled out of the TPP.

Scholars Graham Allison and Kori Schake have grappled over if and how China can replace America as the world’s ranking power. Allison’s recent work, Destined for War, discusses the “windows of opportunity” the US can exploit to slow the pace of the rising power.

If history is any credible guide, the transition from Pax Britannica to Pax Americana may help US policy-makers and the public alike to understand the imperatives that surround China’s rise.

At the turn of the 20th century, America had unprecedented growth, thanks to Alfred Thayer Mahan’s vision of American sea power. And in the early years between the two World Wars, the United States, Great Britain and Japan headlined a global naval arms race.

In 1921, President Warren Harding held the Washington Naval Conference to disarm tensions among the competing navies in the Pacific. The naval powers agreed to discontinue their shipbuilding programmes and capped their naval fleets in the region. America also protected holdings in East Asia from the threat of a rising Japan.

The agreement was a triumph for America. But for Britain, their naval power was now at “eye level” with the United States.

The UK could not challenge the US

An overstretched Britain had neither the political will nor the financial ability to oppose America’s demands, aware that an arms race with the U.S. would likely bankrupt the British economy.

Pax Britannica, a symbol of Britain’s naval dominance, was forced to deliberately accommodate America’s rise. Britain’s reduced Pacific fleet and degraded Anglo-Japanese relations marked a turning point in America’s ascendancy.

It was not the first time Britain missed an opportunity to slow America’s rise. The American Civil War offered the chance, but Britain decided against joining on behalf of the Confederacy due to the issue of slavery. Schake also notes the Venezuela crisis of 1895 marked an early turning point in the leadership transition. This could have also been a window of opportunity.

How does this apply to current US-China relations? The “battleground” remains the same as in 1921; instead, China plans to supplant America to become the global leader.

Barack Obama’s administration crafted the TPP as a geopolitical instrument to halt China’s plans. It presented east and southeast Asian nations with an alternative to China’s coercive diplomacy in the region, such as in the case of Sri Lanka.

Reducing trade barriers had the potential to provide America with greater investment opportunities in the Asia-Pacific region. It could have weakened China’s diplomatic clout while also creating economic incentives for American investment in the area. It exploited a window of opportunity that targeted the source of China’s rise — its economy.

Pulling out of the TPP was not solely a product of the current administration —a Hillary Clinton administration may have withdrawn too. America’s anti-free trade mood reflects the priority of the public and lawmakers, which is to preserve US jobs and sovereignty.

Shifts in global power are afoot

But shifts in global power may be underway with implications beyond what happens on the home front. A tech Cold War is brewing, China’s plans for expansion under the Belt and Road initiative continue and South China Sea claims are an extension of China’s sovereignty.

The rebooted TPP, the 11-nation Comprehensive and Progressive Agreement for Trans-Pacific Partnership, is likely to reduce barriers to trade and increase investment opportunities across Asia and Latin America for its member countries, including Canada.

But the agreement, without US representation, hardly lives up to America’s once-desired aim to create a trade zone in a large swath of East Asia that would isolate China while addressing the global power shifts underway. A renegotiated CPTPP, with American backing, may have even strengthened the Trump administration’s position in its current trade negotiations with the Chinese.

The UK was unable to prevent the last global leadership transition due to missed windows of opportunity and deliberate accommodation. An America that views China’s rise through a short-term bilateral lens runs the risk of accidentally accommodating Chinese efforts to replace America.

Taking advantage of a window of opportunity may be key to curbing the next global leadership transition —and the CPTPP may be the window that America needs before we are forced to accommodate to China’s interests. The US should reconsider joining the pact if it wants any shot at slowing China’s rise.

(James L Anderson is Visiting Fulbright Fellow at Centre for International and Defence Policy, Queen's University, Ontario)

(This article was originally published on the Conversation. Read the original article)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)