A threatening consequence

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FRANCESCO SISCI

There are grave, serious, and sobering consequences in the logic of President Donald Trump’s now famous statement about China not being at fault for its trade surplus with the United States and its disrespect of Intellectual Property Rights.

If China is not guilty for this, then the West and other powers, which tried to colonize China in the 19th century and invaded it in the 20th century, are not at fault for taking advantage of China’s weakness.

This view shelves Chinese ideas about a century of humiliation at the hands of foreign conquerors, ideas of being debased by the Japanese invasion. After all, those ideas about the past can make the present and the future quite difficult, as they hinder normal relations with neighbours.

Donald Trump and Xi Jinping meet business leaders at the Great Hall of the People in Beijing

Trump’s logic opens a Pandora box. If the United States and not China is to blame for being weak vis-a-vis Beijing (giving in on the trade deficit and IP theft), then the United States now must be strong with China.

a very uneven playing field for foreign companies operating in China and also for Chinese companies operating abroad. This reality plus the threat of Trump’s logic makes for a very dangerous mix for China

This logic opens the floodgate to whatever consequences or measures the U.S. deems fit to cope with China. This raises the possibility of a tough confrontation of the U.S. with China.

Does China realise the danger and the threat implicit in this logic ? How does China think to react to this threat and this logic ?

Then there is the other problem, which many in China for many years have decided to forget: many Asian countries, right or wrong, believe China is protecting its own interests at home and trying to expand market share for its goods an industries abroad. This mercantilism, Victor Shih noted, is implicit in China’s own system, which is extremely opaque. Here political and economic decisions are interconnected and impossible to decipher from the outside.

This creates a very uneven playing field for foreign companies operating in China and also for Chinese companies operating abroad. This reality plus the threat of Trump’s logic makes for a very dangerous mix for China, one that China needs to address in a realistic and clear way.

If China accepts Trump’s logic, that it bears no blame for its mercantilism, then mercantilism (or worse) can be applied against China. To prevent this, China must totally reconsider its internal political-economical system and its approach to the international arena. If China doesn’t think of other countries, other countries will not think of China.

Here, to underestimate Trump and his vast base of support in the U.S. and abroad, would be a grave mistake, equal only to those of his fellow republicans and the democrats who underestimated him during the presidential campaign. ■

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