CCG Dialogue with John Thornton, Stapleton Roy and Adam Posen
10 Aug, 2021  |  Source:CCG  |  Hits:5589

Wang Huiyao: Thank you, I agree that it’s a deep concern on both sides that we seem to argue and quarrel at each other all the time. Trump has done quite a lot of damage to the existing relations. One of the problems with the Trump administration is that its core team is not that savvy on China. I had a debate at the Munk debate with Mr. H. R McMaster who is a retired general and a former National Security Advisor of Trump, whomaybe did not have much knowledge on China and with Mr. Michael Pillsbury as well. General McMaster perhaps is more knowledgeable  on the military front. So there was a lack of a great China team  in the Trump administration. But you’re right, we see President Biden has a lot of knowledge of foreign policies, as you said, and he is a president that has spent more time with President Xi than any other leaders in the world and he called the Chinese President  on the Eve of Chinese New Year and said Happy New Year to Chinese people  and issued an executive order banning the use of terms of the China virus. Consequently, all these good moves  have been noticed. But somehow lately, we see there was some acceleration of changes, maybe from the Chinese point of view, such as the G7 summit where there is also an agenda   on China and the NATO summit, the US-EU summit, the US- Russian summit and so on. So now I'm glad that the Deputy Secretary Sherman visited China, we hope that we're going to start a new dialogue. I think the dialogue this time in Tianjin was more concrete now as there's a lot of issues being raised and proposed. We hope to reduce all those frictions on both sides. One of the things that is of great concern, is tracing this origin of the virus from lab. This had already  actually been criticized during the US election and before  they won the election, the Democrats already said that is a conspiracy theory. Because the WHO already sent a delegation that went to Wuhan, and they came back with a suggestion that it’s the least possible to have this kind of man-made virus from labSo, on issues like that, to have FBI or CIA make a conclusion is something we should not emphasize  on, because it's going to divide the current efforts of trying to dialogue. This virus origin issue is getting hot under the Biden administration. Other than that, there's dialogues between the USTR and the Chinese Vice Premier and Commerce Minister, which is great. But the virus origin tracing is not a practical idea. I don't know if you have any comments on that,ambassador Roy. J.

Stapleton Roy: A very brief comment. This, in particular, is an issue on which we should be cooperating and not fighting each other. I think it is important to trace the origins of the virus and we have our own views about how that should be pursued. But the basic point is the pandemics threaten every country in the world and if the two leading countries in the world are unable to cooperate in dealing with the common threat, then there's something wrong with both of us and we need to consider what the problem is that is preventing us from cooperating on this vital issue. 

Wang Huiyao: I agree with you, and the US and China should work together to fight against with the mutant of this virus. This morning, we had a conference where there were 15 ambassadors from Europe, Asia, Africa, Latin America and so on and also the US. ministerial counselors attending. They all agreed that the whole world should act together for the mobility of the people around the world such as working on vaccine passport or certification as well as finding out the ways in which we can really make economic to go around, rather than focusing on non-urgent issues because some cases actually appeared maybe even before Wuhan. But let’s do it systematically rather than ping-point at China. Again, I hope we're not getting stuck into that. Now I'd like to invite Minister Zhu after hearing two think-tank leaders from the US. You are a CCGadviser, and you work for the think tank of the Ministry of Finance, after attending our conference this morning, speaking with Chinese business leaders and government officials like former Minister of Commerce, Chen Deming and former Vice Minister of Commerce, Chen Jian, and a host of other international experts. Since you are a top expert in China on the subject and you led the strategic and economic dialogue and were you are a shepherd for G20, what's your take on this issue, Minister. Zhu? 

The US should reconsider its position on tariff and Xinjiang 

Zhu Guangyao: Thank you very much Huiyao. It's my honor to join this distinguished panel, particularly after President Posen’s and Ambassador Roy’s speech. I’ll try my best to discuss and give some response to Adam’s and ambassador Roy’s points. Firstly, on the tracing of the origin of the virus - I remember in April last year, I had a phone call with Adam, regarding how China-US cooperation can move forward to deal with challenge of pandemic. At that time, Adam suggested the two great countries must cooperate and enhance the transparency and work together within the WHO system. Despite the US administration’s attitudes toward WHO, Adam firmly supported that the WHO plays a leading role and emphasized the importance of cooperation between China and the US to deal with challenge of the pandemic. And I remember clearly that he also suggested us to pay attention to the situation’s development. After China controlled the situation well, the global situation continue deteriorating and then he pointed out three ‘I’ titled countries, India, Iran, and Indonesia. He suggested us to think about the global situation that is continually deteriorating, particularly the three “I” countries. Unfortunately, what Adam said at that time has become reality. Until today, the world is still in the very difficult pandemic situation, which is not just a public health risk, but also has already become a systematic risk in the whole world economically and governance issues are also deeply impacted. And that’s why we really need the two important economies, China and the US, to cooperate together.    

Unfortunately, just as President Posen and Ambassador Roy said, China- US relations now is absolutely in the critical juncture and I think the big issue is the trust between each other. As Posen said, it’s something that is beyond the economy. Indeed, that’s the situation. But as two important countries, we must keep communication and steadily increase understanding of each other and try our best to restore the trust. I know this is not easy to do. But I still think that economic relation is the anchor for our relations. Last year, China-US’s trade volume reached 580 billions. And in the first half of this year, that number increased more than 50% of the total amount compared to the last year. For the six months of this year, the total amount of US China trade has already reached 340 billions. So, even facing the pressure politically and other negative impact, including both sides’ negative public opinion, we see trade still increases, which is a good thing. And that is, I think, very integrated economies have made our interest so closely connected. But I agree with Adam Posen that trade tariff and technology war have very negative impact. How we restore our basic communication now is really important. Just now, Ambassador Roy mentioned the Biden administration’s team is professional, I agree with it. I used to deal with many officials in Biden’s team, and I understood they are indeed professional. But I must point out some key issues that Biden administration should correct immediately since that is a part of the US interests, including tariffs - just as Secretary Yellen said, are not in US’s interests and damage the benefit of the US consumers . However, until now, six months passed and there isn’t any single change. And as for the key issue beyond tariff and the economic side – on the political side, as ambassador Roy mentioned, such as the genocide issue, which is an absolutely wrong judgment made by the last administration within the last two weeks when they were in position. They used this as a reason to block import of all cotton and tomato produced in Xinjiang. Unfortunately, the secretary of state in the Biden administration still conforms the previous policies and continued to blame that in Xinjiang there are genocide of Uighurs. And this kind of standpoint is definitely wrong and makes it dangerous for China-US relations. And just as Ambassador Roy said in his words – “an unprecedented risk”. I think this one is a real cause to result in and we must use public and private conversation and communication to solve the problem and that's why China welcome foreigners to visit Xinjiang and I know that foreigners can freely visit. We should have a real professional way to solve the problem. These obstacles must be overcome and we must find real facts to solve this problem. And this is the key for Chinese principles and this is just one of the cases. I do think that such communication is very clear to the point and is a very useful option on the table. Adam suggested three points of that kind, which I think are very important. One thing Adam said is that there is something beyond economic situation. Yes, we should have more comprehensive discussion and to realize it, we should find a way to expand our discussion beyond the economic. Also, I think that everything will be connect in terms of economic relations because US entrepreneurs need good environment for their investment in China and Chinese investments in US. Second, climate change certainly is a practical way for cooperation, including ESG (environment, social and governance). I think this has already become beyond the pure climate change issue and it is broader and more comprehensive and think tank certainly is a real channel for our cooperation. In this regard, I figure out four points suggestions. One is we China and US must find the way to deal with each other’s challenges, to develop peaceful coexistence. Based on communication, mutual understanding, we could enhance our cooperation into the peaceful coexistence. Second, both China and the US need to keep on opening and reforming. China is deepening its structure reform and is more open to the outside world for our domestic interest of course, and this is also in line with global cooperation. The third point is we must have real cooperation in our multilateral system on trade and financial institutions, WHO, IMF, World Bank, and other UN special agencies. The global network needs our operation to maintain, improve and to enhance it, ensuring the peace and development of the world. Last one, I suggest we keep this real dialogue and communication, and we need real mechanisms such as S&ED (US-China Strategic and Economic Dialogue), BIT (US-China Bilateral Investment Treaty) in the Obama administration to which I joined that negotiation discussion and now it’s 90% finished. The most important issue that have been not solved is digital economy which is related to data flow across the world, data privacy issue which has become more important today. And now every country, including US China EU and others is emphasizing domestically how important the development of digital economy as well as enhancing the security of civil system and privacy. These all need global condition and global negotiations. Maybe one possible breaking point is E-commerce negotiation in WTO. I know that's still very difficult, but we should try, which is for the future growth and the real need for our cooperation between China and US. 

Wang Huiyao: Thank you, Minister Zhu. You raised many good points, among which I particularly agree with you is the standing issue of Xinjiang. Of course China in the past has no experience dealing with terrorism so the situation could be improved. However, it is definitely no  genocide in Xingjiang. I think that Pompeo came up with that statement and then Blinken went along with it to testify in order to pass norminatiom at the senate hearing. Access to Xinjiang is now really open, all the foreigners can visit there. Recently, we talked to some foreign embassy officials - the ambassadors didn’t go but the embassy did send staff there. They came back with their own report. It's obvious there's nothing like genocide. So now, there's nothing special restriction for foreigners to visit Xinjiang. Just buy your ticket and you can go and see whatever you would like to see in Xinjiang. So, I think that issue must be sorted out so that we can reduce the tension. And on seeking more collaboration as Minister Zhu mentioned, if the 90% of the US China BIT negotions has concluded why can't we continue this 10% remaining? On data issues, now, after six years from Obama administration, we have had lots of new progress. Now, China is a country with much more  big data  and data is like oil - if you don't flow data there is no wealth being created. And there are  other changes - China recently agreed to join the OECD minimum global corporate tax plan, which is proposed by G7 and G20, which is a good example of how we can avoid these loopholes of tax heaven and then tax return can benefit both the host and home country. Also, we can talk about collaboration on WTO as Minister Zhu said, as well as CPTPP which was proposed by the Obama administration to which China announced that it's going to join as the Ministry of Commerce has put the CPTPP agreement on its website. So that's the standard and target that we should aim for. China is not afraid of talking about these points but I hope that we have more channels to talk, including the WTO. Now I really would like to invite John Thornton, a very well known and highly influential panelist. John, you have been the honorary chair for Brookings for a long time and the John Thornton China Center in Brookings is named after you. More than 10 years ago, during my days at the Brookings as a visiting fellow, it was already there. You are also the co-chair of Asia Society, which is a very influential bridge between the US and China. On top of that, you are very familiar with China, you were the first American to become a professor at the Tsinghua’s Economics and Management School. During last year’s CCG Annual Forum, you  talked about thedeficit of trust between US and China and how we can  build up the trust. Now we are half year into the new Biden administration, what more can be done? John, you have the floor, please.  

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