In the past ten years since China entered the WTO, dramatic changes in the global economy and the political situation in the U.S. have profoundly affected China's economy and Sino-US relations.
Ever since its entry into the WTO, China has been more involved in global economic affairs, and has used its improved status on the world stage to further its rapid economic development. Facing the changing economic and geopolitical climate, the U.S. has also modified its policies towards China. Indeed, Former Bush administration chief trade representative Robert Zoellick formed the idea of China as a "stakeholder" on the world economic stage.
After the Sept. 11, 2001 terrorist attacks, the U.S. adjusted its national security strategies, and turned China from a major competitor into an important partner. 9/11 thus can be seen as playing a major factor in improving Sino-U.S. relations.
When the 5-year WTO transitional period came to an end in 2006, the U.S. started to put more pressure on China to keep the promises it made when it entered the WTO. Since then, China's constant revaluation of RMB has not been enough to stave off U.S. pressure. It seems that China and the U.S. are still not fully ready to confront various challenges facing the two countries.
In both the Bush and Obama administrations, RMB exchange rates and the U.S.-China trade deficit have been the main subjects of debate. Whenever the U.S. public has been unsatisfied with the trade situation between the two countries, these two issues have always been easy targets to attack. A prominent example was the "China Card" played by candidates during the Midterm Election in 2010, especially regarding the issue of RMB exchange rates.
During the Bush administration, some American scholars pointed out optimistically that from a strategic point of view, the confrontation between the two countries on trade issues was better than on other issues such as Taiwan. In reality, there is no large risk of a trade war between the two countries, because both sides understand that they are highly interdependent. A break in Sino-US trade relations would bring inconceivable consequences for both sides.
The governing style of Bush administration considerably influenced Sino-US relations, especially on economy and trade. The Bush government knew that the mutual benefits of cooperation between the two countries were far larger than the areas of dispute. The Chinese people were steadfastly developing their economy, and Americans were eager to take full advantage of the business opportunities available to them. President Bush's approach to the overall situation contained economic and trade frictions between the two countries to a controllable sphere.
The author is a columnist with China.org.cn. For more information please visit: http://www.china.org.cn/opinion/zhangguoqing.htm
(This post was first published by the FTChinese.com and translated by Xu Lin.)
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