context: Chinese analysts have used the word 'hegemon' in association with US trade war policy, arguing that tariffs are an attempt to maintain US economic control. In response, experts advocate varied solutions, ranging from a wait-and-see approach to more proactive measures.
In the context of the unavoidable trade war, China must continue and deepen its reform and opening policy to avoid the Thucydides trap, argues Zheng Yongnian 郑永年 South University of Technology Institute of Public Policy Academic Committee chairman.
The trade war reveals that the US desire to maintain hegemony remains the essence of China–US relations. Nevertheless, both parties’ nuclear arsenals deter total military confrontation, yet limited conflicts could still lead to another military and political cold war.
The current trade war is a ‘technological Cold War’, writes Zheng, in which the US wants to
- slow down China’s process of modernisation
- facilitate China’s descent into ‘middle-income trap’ or ‘poor socialism’
Before taking actions to respond to the trade war, China should acknowledge that it lacks technological innovation and development, which China must address by
- limiting the trade war to areas where it can find replacement countries for imports
- such as automobile and agricultural industries
- importing US energy products, such as shale oil, to balance trade deficits
- a constant point of focus for Trump
- utilising multilateral institutions
- opening the internet sector to the global market to promote technological innovation and attract capital
- developing national opening platforms (国内的开放平台), such as Guangdong–Hong Kong–Macao Greater Bay Area, to attract foreign investment
- improving intellectual property protection to encourage China’s enterprises to innovate and operate according to international rules