Government Affairs Forum Event - Expert Insight Sharing - Status of the US-Chian relations and Trade Conflict

2019-09-12 | All chapters

On 12^th Sept., John Holden, senior director and head of China Practice at McLarty Associates, shared his insights on U.S-China relations to members of the European Chamber Government Affairs Forum.

Mr. Holden believes that the Trump administration in the U.S is so far the least prepared administration comparing with previous administrations. Trump and Bolton (Bolton was recently fired by Trump) successfully destroyed inter-agency cooperation in the U.S government on China policies.

The turmoil of the trade war is believed by many as a turning point of the U.S.-China relations, however, Mr. Holden believes that the mistrust and instability in U.S-China relations has been brewing well before Trump and the U.S-China relations has never been that good. He then mentioned a few historical incidents where the U.S.-China relations were tested and in far worse situations. Mr. Holden also accounted his own role in one of the incidents.

But Mr. Holden still thinks that there is always a force to prevent the worst from happening between the U.S. and China. Additionally, history has unexpected turns. For example, China’s accession into World Trade Organization happened very quick and smooth, despite the underlying instability between U.S. and China at that time.

The spotlight of the recent turmoil in the U.S-China relation is the trade deficit, which, objectively speaking, is a structural result of the U.S economy. But whether objective or not, the trade deficit is a political problem in the U.S. Trump sincerely believes tariffs is a useful tool to reverse trade deficit, despite prevailing counter-evidence. Additionally, Mr. Holden believes Trump’s unpredictability makes it difficult to predict the result of the trade negotiation. He believes China might be gambling with the prospect that Trump won’t get re-elected.

Audiences subsequently raised many questions, including the role of the European Union in the U.S-China trade war. Mr. Holden believes that the EU is supportive of taking on China with many issues, but is not supportive of the tactic (tariffs). In addition, he emphasized that the trade war hurts both sides.

The GA Forum event subsequently discussed extra security measures put in place in Beijing during the 70th Anniversary Celebration of China.