China-US Relations: Bad for Business?

Filed in archive News on February 12, 2010

© rajkumar1220


I've seen a number of stories recently about the U.S. relationship with China, and how it seems to be headed downhill. It's hard to image that such a decline won't have business implications. Google's China problem seemed to personify the larger situation for a while. It has to do at least in part with differences in values...

China-U.S. relations is a constant topic of news. The two countries are the only two real superpowers in the world and they have become more and more involved with each other. Early this month the tone of the coverage seemed to change, and I noticed it with this story on NPR.

U.S.-China relations have been going downhill to the lowest point in recent times. The growing friction does not seem to be a passing phase. China has rebounded from the worldwide recession and appears conscious of its growing power. And America, which has a vast part of its foreign debt in Chinese hands, can no longer consider itself the unchallenged superpower.

To some extent it's about the same old policy issues that have always been points of friction: trade, the exchange rate, human rights (President Obama will has a meeting planned with the Dalai Lama), and (of course) Taiwan.

Anthony Kuhn recently interviewed Yuan Peng, a U.S. expert at the China Institute of Contemporary International Relations, a government think tank in Beijing. Peng says that China went through a period of optimism after President Obama was elected.

Many Chinese initially had hopes that the Obama administration would bring a fresh approach to ties with Beijing, emphasizing cooperation on global issues such as climate change and non-proliferation, over bilateral disputes concerning Taiwan, Tibet and human rights.

From the Chinese perspective, that hasn't happened. And from the U.S. perspective, I guess America's problems with China transcend partisan politics. Democrats and Republicans may snarl at each other, but a year into the Obama Administration the Democratic approach to China doesn't seem much different than the Republican one.

Stan Abrams seems to think that President Obama has some good China advisors on staff and that he isn't listening to them.

Whatever the problem, one result that's made the news this week is that China plans to place tariffs on American chicken exports to China. The extent to which China-U.S. tensions will further impact the business climate remains to be seen...