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US-China Trade Relations Won’t Improve if Biden Wins

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To say that the US and China’s relationship is lukewarm is an understatement. Even if Democratic nominee Joe Biden wins the elections, US-China trade relations won’t improve. Taimur Baig, the chief economist at DBS Group Research, said the election won’t change the status. Even before the pandemic, Chinese tech firms bore the brunt of the administration’s ire. Phone giant Huawei and social media app TikTok both experienced what it’s like first hand. Trump called out both Chinese companies as capable of collecting American user data. After doing so, they would hand the information over to Beijing.

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The US Commerce Department followed suit last week to the White House’s example. The US  placed restrictions on exports against China’s biggest chip maker SMIC. The department feared that export equipment might end up used for military purposes.

If you think Biden will change policies and change direction on China, you’re wrong. Baig said: “Imagine a scenario where Biden becomes president, I don’t think on the technology issues … (they) are going to go away in any meaningful manner. It may be less volatile, it may be more rules-based, but the tensions will remain.”

“So I don’t think the U.S. elections outcome per se makes things infinitely better for China. It probably makes it a little less volatile,” Baig added.

How do you solve a problem like China? 

A Gallup poll made last February showed that 33% of Americans have a favorable opinion of China. In 2018, 53% favored China, while last year it was 41%. Note that these numbers were pre-pandemic and during a time when the US economy was humming.

Newer research from Pew last July now shows that 73% of Americans hold China in a bad light.  Coronavirus, Chinese spy students, and the Huawei issue may have eroded China’s image. However, the same survey reported that 51% want to form a strong economic relationship with China.

Biden is tiptoeing on China 

What does Biden have to say about American sentiment? In 2018, when Trump sparked a trade war by imposing billions of dollars in tariffs on Chinese goods. Beijing retaliated almost immediately on American produce. Biden criticized the White House, saying that the tariffs hurt American businesses. At the same time, he advocated the US to “get tough on China.” He warned that America needs to act or China will “keep moving and robbing U.S. firms” of patents and technology.

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Trade experts think that Biden is under pressure to continue the tough stance on China. Given the anti-China sentiment, he may continue the tariffs started by his rival. Baig believes China can take care of itself. He said: “On one hand, you could argue that the trade tensions forced China to increase investments in domestic homegrown technology, and it acts as a booster shot, if you will, inadvertently by Trump … by pushing China into a corner (and) forces China towards what they call self-sufficiency. So I don’t think that hurts China in the near term.”

At least Trump’s standing his ground

Baig wondered if it’s sustainable for the U.S. to continue denying China. Both candidates can declare they don’t want China’s military to gain access to US tech. But declaring a national security movement based on that might be more difficult. The sheer number of consumer products that use similar tech is too lucrative to ignore. 

Kurt Campbell and Elly Ratner, senior Obama officials admitted downplaying the China threat. They have also started pushing a less aggressive form of free trade. Biden is aware that letting China run free with trade is not a policy that America wants anymore. Former undersecretary for commerce Frank Lavin believes Biden needs to follow Republican policy. Biden has to “retain some elements of Trump policy, but he certainly will not retain the harsh tone and the sort of combative rhetoric.” He added, “that will be an improvement.”

Watch this as SkyNews Australia showing that Presidential candidates Donald Trump and Joe Biden are “trying to outpoint each other in China”:

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Say what you want about Trump’s hardline stance about China, but the man knows how to stand his ground. The Democrats realize that handling China with kid gloves is what may have emboldened it. They now want to say no like Trump. But in a kinder, gentler approach. Good luck with that.

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