Although lead-coated Chinese toys and the US’s trade deficit with the country did come up during the American presidential election campaign, it is significant that neither Democrat Barack Obama nor Republican John McCain made China a major campaign issue.
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China Won’t Be An Obama Priority
By FRANK CHING
28 November 2008
Although lead-coated Chinese toys and the US’s trade deficit with the country did come up during the American presidential election campaign, it is significant that neither Democrat Barack Obama nor Republican John McCain made China a major campaign issue.
This reflects the growing maturity of the Sino-American relationship as well as the fact that both candidates appreciated the value of America’s relationship with China. Now, with the United States mired in an economic collapse brought on by the securitisation of sub-prime mortgages - otherwise known as ‘toxic securities’ exported to the rest of the world - Beijing’s value to Washington is likely to trump other issues, such as human rights, religious freedom and Tibet. Recently, China - holding 10 per cent of US Treasury notes - surpassed Japan as America’s largest creditor. And Washington clearly wants China to continue to lend it money as the US tries to spend its way out of recession, to the tune of hundreds of billions, if not trillions, of dollars.
The question is whether Beijing will be willing to play this role. China realises that it is in its interests to help the US, but Beijing faces severe economic challenges of its own. It, too, has announced a massive fiscal package and has made it clear that its main contribution to the global crisis is to keep its own economy growing.
During the campaign, Mr. Obama did say that he would keep Chinese toys out of the country. He also urged President George W Bush to boycott the opening ceremony of the Olympics. But these issues are unlikely to emerge again in any serious way. But he said more than once that, as president, he would press China to revalue its currency so as to level the playing field. Last month, in a letter to the National Council on Textile Organizations, he again accused China of ‘manipulation of its currency’s value’ and said that the country had to change its foreign exchange policies. He promised to ‘use all diplomatic means at my disposal to induce China to make these changes’.
This is an issue that will emerge again. But with thousands of factories shutting down in China and throwing millions of people out of work, it is unlikely that Beijing will agree to reduce its exports by raising the value of its currency. Pressure from Mr. Obama is unlikely to yield positive results. But in the letter, Mr. Obama limited himself to ‘all diplomatic means’. He did not say that he would seek to impose tariffs on Chinese goods if Beijing refuses to comply. So he may have left himself enough wriggle room.
So what does China think of an Obama presidency? China has observed its policy of avoiding interference in other countries’ internal affairs and maintained a studied silence during the campaign. And, after Mr. Obama’s electoral victory, President Hu Jintao sent him a congratulatory message. ‘China and the United States share broad common interests and important responsibilities on a wide range of major issues concerning the well-being of humanity,’ Mr. Hu wrote. ‘To grow long-term healthy and stable China-US relations serves the fundamental interests of our countries and peoples, and is of great significance to the maintenance and promotion of peace, stability and development in the world.’ No doubt, an identical message would have been sent to Mr. McCain had he emerged as the victor.
A sophisticated observer, editor Li Datong, has said that his government felt that American ‘policy towards China will not show a big difference no matter which party wins’ and that ‘it is impossible that the next president will make a big change in China policy’.
This observation accurately reflects the historical record. Ronald Reagan, Bill Clinton and George W Bush all said during election campaigns that they would change their country’s China policy, only to find after the election that there is little that they can do differently.
Taiwanese President Ma Ying-jeou, too, sent greetings to Mr. Obama. But Taiwan, being much smaller, is a little less confident of its ability to win Washington’s support, especially at a time when the United States may be increasingly dependent on Beijing’s cooperation.
Looking at the bigger picture, Mr. Obama’s priorities in his first 100 days are unlikely to be China or Taiwan but rather dealing with the badly faltering economy; handling the wars in Iraq and Afghanistan; dealing with a potentially nuclear Iran and the face-off with Russia.
Given the global economic and political environment, the new president is unlikely to spend much time on the cross-strait situation. After all, there is no impending crisis. And that may not be a bad thing.
The writer is a Hong Kong-based journalist and commentator
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