How relations between China and the US are heating up

Dr. Mohamed A. Ramady

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As the world lurches from one geo political crises to another, especially between Russia and some major western countries, the relationship between the USA and China is also entering a period of cold spell following the glowing praises that President Trump heaved on Chinese President Xi in the US last year at his Florida resort.

A major contention and what seems to be a red line for China is the complex issue of Taiwan. President Xi Jinping considers the signing of the Taiwan Travel Act by US President Donald Trump to be a severe – and deliberate – escalation of tensions in Sino-US relations, coming on the heels of already heightened tensions over trade.

The appointment of John Bolton, a leading neo-con hawk as National Security Advisor who does not believe that the US should recognize a One China policy will only add to this tension. While the Chinese can live with the upheavals of the US tariff hikes on imported Chinese products and see it as a starting negotiating point between the two countries, the Taiwan Travel Act has raised the stakes to a new level.

And if President Trump were to allow the US Secretary of Defense or Secretary of State to visit Taipei, or welcome Taiwan officials to visit the White House, Chinese officials warn Beijing will not hesitate to expel the US Ambassador to China, and to take “unprecedented retaliatory measures” that would deliver a heavy blow to US agricultural producing states and to the US financial markets.

On the trade war front, the Chinese are set to prepare a full slate of countermeasures on trade, including specific and targeted actions against certain US goods through retaliatory, high tariffs, and through the imposition of new, strict import standards.

Beijing, nevertheless, does still interpret Trump’s latest moves as “opening positions” in negotiations before the two leaders meet face to face, and believes the US president will continue to push for concessions from China even while averting an outright collapse in talks.

They see the current tactics following the same template, albeit a much more alarming one, as the White House positioning in the run-up to the first Xi-Trump summit held at Mar-A-Lago last year.

With the signing of the Taiwan Travel Act, on the heels of heightened tensions over trade, and the firing of Secretary of State Rex Tillerson in favor of the more hawkish CIA Director Mike Pompeo, Beijing is bracing for a period of instability in relations with the US for months to come

Dr. Mohamed Ramady

On a knife’s edge

With the signing of the Taiwan Travel Act, on the heels of heightened tensions over trade, and the firing of Secretary of State Rex Tillerson in favor of the more hawkish CIA Director Mike Pompeo, Beijing is bracing for a period of instability in relations with the US for months to come, relations some believe will remain on knife’s edge until the two leaders agree to set their first summit of this year.

The Chinese have issued the first warning shots and already five departments, including, most pointedly, China’s Ministry of National Defense, issued warnings that the Trump administration refrain from the implementation of relevant clauses of the act, and stop seeking any official contacts and military ties with Taiwan.

President Xi has made it clear that he considered it a deliberate provocation by Trump himself. The act, though not legally binding, is said to “severely violate” the One-China principle, as well as the three joint communiqués the US signed with the People's Republic of China. Foreign Minister Wang Yi for his part also lodged a formal protest and “stern representations” over the Taiwan Travel Act.

Wang relayed China’s position that it will take all necessary measures to deal with the situation if US warships were to anchor in Taiwan, and to expel the US Ambassador to China from Beijing if US Secretary of State or Secretary of Defense was to visit Taipei, or Taiwan officials visit the White House.

Mr. Xi said “achieving total unity” was the “collective hope of all Chinese people” and any attempts to divide it were “doomed to fail”. The speech was a strong warning against any attempt at separatism from places like Taiwan and Hong Kong. With Trump’s recent sacking of several key administration officials, Chinese officials expect policy from Washington to continue to turn more hawkish and confrontational.

They are specifically alert to the implications of the recent firing of Rex Tillerson, and Trump’s plan to replace Tillerson with CIA head Mike Pompeo, and believe Pompeo may prove to become the most hostile US Secretary of State to China in recent US history, and this is without the recent John Bolton appointment.

With Trump’s already tough stance on Sino-US bilateral trade, Taiwan, and the South China Sea, officials in Beijing are now bracing for instability in Sino-US relations for months to come. This is one more headache the world can do without.
Dr. Mohamed A. Ramady is Senior Advisor with Partner Energy, and former Visiting Associate Professor, Finance and Economics, at King Fahd University of Petroleum and Minerals, Saudi Arabia. He specializes on middle east energy policy, the Saudi Economy, OPEC, GCC regional geo-political risk assessment and has authored many books such as “The Saudi Arabian Economy: Policies, Achievements and Challenges”, “GCC Economies: Stepping up to Future Challenges”, “Economic, Political and Financial Country Risk: An analysis of the GCC countries”. In 2015 he completed several books on “OPEC in a shale oil world: where to next?”; “The Rentier Theory Revisited”; and “The Political Economy of Social Capital”.

Disclaimer: Views expressed by writers in this section are their own and do not reflect Al Arabiya English's point-of-view.
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