Taihe Institute

1. Introduction

China and the United States continue to pursue diverging foreign policies as each nation seeks to protect its own interests, solidify its place in the evolving world order, and restructure international relations in the 21st century. Issues regarding international trade, intellectual property, and technology governance continue to plague the relationship between the two powers. As recently as March 2021, the world witnessed high ranking foreign affairs officials trade accusations and lambaste each other on the world stage in their dialogue in Anchorage, Alaska.

Despite the apparent continuation of the unraveling of ties between the U.S. and China, opportunities to stabilize and rebuild the relationship between these two countries are still available. The United States and China may not share identical stances or interests on many issues, but there is common ground and a willingness to work together on some of the most complex issues facing the world today. While the resolution of one single issue will not resolve the differences between the U.S. and China, greater engagement, improved communication, and a willingness for reconciliation can ultimately guide the two countries to a path of coexistence. Ultimately, improved cooperation between China and the United States will not solely benefit the people of each country, but their allies and future generations that will benefit from a more stable world order.

As China-U.S. relations are of immense importance and at a critical juncture, TI Observer will be covering "cooperation" and "competition" themes in bilateral relations in different issues, with the April and May issues focusing solely on "cooperation" as the world needs it more than ever and the June issue analysing "competition."

2. Overview of Possible Areas of Cooperation Between China and the U.S.

Despite some frosty talks, Alaska meeting still represents a dialogue between China and the U.S. and showed that there are a number of areas both sides can substantially cooperate on. The climate agreement reached between the two sides following a visit by U.S. Special Presidential Climate Envoy John Kerry to Shanghai in mid-April is further proof of it. As both countries are the world’s biggest carbon emitters, their collaborative approach to the climate issue beyond words would surely resonate with the rest of the world, creating a substantial area for universal cooperation.

2.1 Climate, Environment and Decarbonizing the Global Economy

U.S.-China cooperation on climate change proved to be essential for the global climate movement in the past, particularly in clinching the Paris Agreement. The groundwork for the relationship was laid during then U.S. Secretary of State Hillary Clinton’s first trip to China in February 2009. It made further progress with the establishment of the new U.S.-China Climate Change Working Group supported by then Secretary of State John Kerry, and was finalized with an historic joint announcement by Presidents Xi Jinping and Barack Obama in Beijing in November 2014. Such cooperation eventually led to the adoption of the Paris Agreement on December 12, 2015 at COP21 in France. However, the U.S.-China climate relationship took a more drastic downward spiral when President Trump took office in 2017. During the Trump era, it was China who took a leading role to combat climate change and carried the global climate movement forward.

(source: climatevisuals.org)

Under the Biden administration, which brought back the U.S. to the Paris Agreement, the original climate cooperation agreements between Beijing and Washington have partly become operational again. This cooperation process acts as an important catalyst for both countries improving their relationship and opens up new avenues to expand the cooperation. Their mutual goal to cut down carbon emissions and invest in green energy infrastructure could allow for further joint climate action and complementary policies. However, before the climate relationship between the two countries can fully resume, the Biden administration will need to take some meaningful actions to bring Beijing to the drawing board. To start with, the U.S. needs to find a middle ground to halt further decay in broader bilateral relations and should establish a new relationship model together with China under which both sides can peacefully coexist. Climate change can serve as such a middle ground. The latest Shanghai climate agreement between the two sides is an important step in the right direction.

Second, the Biden administration needs to introduce practical policies that can reflect its renewed commitment to transforming the climate landscape. The Obama era, which was characterized by the administration largely acting on its climate promises, encouraged the other countries to do the same by implementing its policies. The Biden administration will need to do the same.

Climate change is interconnected with the technology race, which partly defines the current U.S.-China relations, setting new battlefronts to lead the technology race and global dominance in this area. However, the same U.S.-China Climate Change Working Group can be utilized as a foundation for both nations to build new and expanded cooperation. The working group can serve as a central platform for the U.S. and China to share necessary information on their decarbonization plans and work together on developing clean energy technologies and policies.

China and the U.S. are the largest emitters of CO2 globally, and their climate relationship is critical for lowering compliance costs of climate mitigation and adaptation and moving international climate negotiations forward. But the U.S.-China relationship is different from what it was four years ago, especially on climate action. In its effort to combat climate change, the U.S. took a technology-oriented approach, including the launch of four multilateral initiatives on technology cooperation and the Asia Pacific Partnership for Clean Development and Climate (APP). China is a crucial participant in these initiatives and a partner to the APP, and these have had a significant positive impact on climate action. The special climate envoys of both countries, Xie Zhenhua and John Kerry, can display the same cooperation that led to the adoption of the Paris Agreement in 2015 to achieve future carbon goals. Equitable distribution of mitigation duties is the basis for cooperation on carbon reduction. The specific rule book for carbon market linkage is thus key to successful implementation.

John Kerry (source:CNN)

The latest Shanghai climate cooperation agreement reached by Beijing and Washington during U.S. Special Presidential Climate Envoy John Kerry’s visit to China is an encouraging development and a good model of cooperation between the two sides especially at a time when there is much talk about competition. China and the U.S. “are committed to cooperating with each other and with other countries to tackle the climate crisis, which must be addressed with the seriousness and urgency that it demands,” said the statement issued on April 18 after two days of talks in Shanghai. John Kerry called the language of the statement “strong”, saying Beijing and Washington agreed on “critical elements on where we have to go.”

Su Wei, a member of the Chinese delegation at the talks, said that a major accomplishment of the talks was “restarting the dialogue and cooperation between China and the United States on climate change issues.” Su added that Beijing and Washington reached a consensus on key areas for future cooperation on climate issues.

During the Trump era, climate policy was regarded as a factor to deepen the chasm between China and the U.S. rather than bridge it. But, with Shanghai agreement, both sides are now setting a good example of cooperation in tense times.

It has even led to China’s participation in a (virtual) leaders summit as Beijing announced on April 22 that President Xi Jinping would attend the Leaders Summit on Climate hosted by U.S. president Joe Biden. The next step will surely be how the countries involved in climate action go beyond words and engage in concrete actions on this vital issue for mankind.

2.2 Science, Space and Cybersecurity

(source:China National Space Administration)

Over the past two decades, U.S.- China relations on space programs have been entirely independent. This can be attributed to U.S. policies: Since 1999, U.S. export controls have served as a blockade to commercial, academic, and government exchanges between the two countries’ space programs. Since 2011, the severity of these policies has dramatically increased thanks to what is known as the “Wolf Amendment” in the U.S. Congress, preventing bilateral interactions between NASA and the China National Space Administration (CNSA) on civil and scientific topics.

While both countries have now the world’s leading space programs, the U.S. maintains the lead and is likely to continue its dominance in the decade ahead. However, space is an area that imposes cooperation on both sides inescapably. China’s Global Times reported on March 31, 2021 that the CNSA confirmed to the state-run daily that NASA held working-level meetings and communications with the Chinese space agency from January to March 2021 on exchanging data to ensure the flight safety of Mars spacecraft. It is likely that both sides as frontrunners in space exploration will engage in more information-sharing and possible scientific collaboration in space in the future.

Cyberespionage problems have, since the early 2000s, complicated the relationship between the U.S. and China. To combat the espionage issue between the two countries, Beijing and Washington reached a bilateral cybersecurity agreement in 2015 to mainly prevent the theft of intellectual property and trade secrets. However, the Trump administration questioned the effectiveness of the agreement. Yet, both sides managed to hold a high-level security dialogue despite the strained relations even during the Trump era. The 2015 deal is a significant landmark in China-U.S. relations and can be leveraged for future cybersecurity agreements. China has also called on the U.S. to “meet China halfway in jointly safeguarding the two countries’ momentum for cooperation and communication in the realm of cybersecurity.” It is noteworthy that the China-U.S. Agreement on Cooperation in Science and Technology signed in 1979 was one of the first deals between Beijing and Washington after they started to normalize their diplomatic relations. This underlines the potential of this field for cooperation between the two countries.

China and the U.S. are now each other's biggest international peers in co-authored papers, according to the U.S. National Science Foundation. The two sides have also benefited from conducting joint research in such cutting-edge programs as Daya Bay Reactor Neutrino Experiment, electron positron collider and nuclear fusion experiments.

A robust science and technology cooperation between the two countries is of major significance for global scientific progress in fields like genome research, quantum computing and space science.

Science and technology collaboration is one of the underpinnings of the overall China-U.S. relations and the ramifications of blocking such cooperation and bullying Chinese tech firms have already been seen as the global chip semiconductor shortages hit hard many industries worldwide. Science and technology is not a field for a zero-sum game.

Thus, with the rate at which information technology is developing, it is in the interest of both countries to choose cooperation rather than confrontation to avoid risky outcomes of any self-damaging competition. In a world of expanding interdependence, the best way to boost science and technology development is surely through cooperation.

(source:pixabay.com)

2.3 Global Pandemics, Public Healthcare and Building a Global Disease Surveillance Network

Starting from 2004, leveraging existing technical exchanges and training programs, the United States Centers for Disease Control and Prevention (CDC) and the Chinese National Influenza Center (CNIC) initiated cooperative agreements to build capacity in influenza surveillance in China. Through this collaboration, China improved its capacity in influenza prevention and control. Since 2004, the influenza surveillance and response system has expanded in size, capacity, and function and has improved the quality of its testing, use of data, and disease management, prevention, and treatment capabilities. The U.S. is the world’s largest funder of medical research, drug development, medical equipment, and technologies. China has since followed suit, increasing its funding for national and global research and development, benefiting all partners in the cooperation. Between 2012 and 2018, China grew to become the U.S.’ largest scientific research partner, second only to the European Union.

Telehealth and telemedicine have, for years, been crucial to increasing access to and decreasing the costs of healthcare, and in covering areas where traditional medical institutions cannot reach. Before the outbreak of the global pandemic, the growth of telehealth was restricted in the U.S., due to the various health regulations and policies. However, with the COVID-19 pandemic, the advantages of telehealth have been self- evident. As experienced in recent years, traditional health systems are having trouble in managing growing patient demands and an aging population as well as increasing medical costs. They also face difficulties in containing the rapidly growing prevalence of chronic diseases and handling public health emergencies. With the global pandemic magnifying these various issues, the U.S.-China health system collaboration has been employing telehealth to facilitate physician-to-physician communications and enable medical teams to participate in direct-to-patient virtual services, overcoming regulatory uncertainties and barriers.

(source:pixabay.com)

Despite their stark difference in historical and cultural backgrounds and context, it is now imperative for the medical and healthcare systems of the two countries to collaborate. They both have the capability, resources and talent to combat and contain future epidemics and to further advance the worldwide medical and healthcare standards. This is evident from China’s provision of over 2.46 billion masks and about 5,000 ventilators, and hundreds of millions of other PPE items to the U.S. by April 20, 2020. However, the global supply allocation has been impeded by factors outside manufacturing, including transportation, varying certification standards among countries, route disruptions, and supply cancellations. Thus, the U.S. and China must reinforce the weak global health supply chain and set up globally recognized standards, within a possible disease surveillance platform, which could lead global responses in the future.

2.4 Poverty Alleviation and Food Safety & Security

(source:climatevisuals.org)

As the largest developing country globally with a population of about 1.4 billion, China had been stricken by poverty in a scale and level of severity unseen anywhere else. However, as this year marks the 100th anniversary of the founding of the Communist Party of China (CPC), the country has achieved eradicating extreme poverty as it was one of the top priorities of the Party’s agenda.

Since he took office, China’s President Xi Jinping has supported the national poverty reduction programs giving full backing to the country’s paramount poverty-alleviation campaign. The funds allocated to poverty alleviation from the central budget more than doubled in recent years.

Through its public-private partnership with the World Food Program and the U.S., the Chinese government has been further developing partnerships with civil society organizations and companies that can provide financial and technical support in food-insecure areas. As an example, the Agriculture and Food Partnership (AFP) is a public-private platform created in 2013 as an extension of the U.S.-China cooperation on food and agriculture, aimed at connecting the two countries’ public, private, and non-governmental organizations across the agricultural and food supply chain to develop mutual food security, food safety, and agricultural sustainability. It also promotes cooperative activities between the U.S. and China, optimizing practices in both countries.

The U.S. Food and Drug Administration (FDA) should also enhance collaboration with Chinese food authorities, help the country’s regulators to understand the impact of the Food Safety Modernization Act on their food industry, and build confidence in laboratory work.

The U.S.-China cooperation on food security also takes place under the umbrella of international organizations. China has explored to bolster its food security and safety through its collaboration with the Food and Agriculture Organization (FAO) to obtain technical assistance in order to realize a “zero hunger” world. The FAO signed an MoU with the Chinese government in 2012 to deepen mutual cooperation to fight hunger, increase agricultural production, and improve rural livelihood. In 2019, China and the FAO commemorated the 10th anniversary of the establishment of the FAO- China South-South Cooperation (SSC) Trust Fund and its achievements.

China has made great strides in reducing hunger and malnutrition across its vast territory and has been relentless in achieving its goals to ensure food security and safety within the country. However, it still faces hurdles in successfully extending its national poverty-reduction program to some marginalized communities in remote areas. To overcome such difficulties, it has entered many cooperation agreements with international organizations and provided support to end poverty in many underdeveloped countries, which underlines the importance it attaches to the theme of cooperation.

Furthermore, the post-pandemic food industry offers major opportunities for future China-U.S. cooperation. From securing food supply chains to food insecurity crisis, Beijing and Washington cooperation can surely help overcome “nobody is safe until everybody is fed” mantra.

2.5 Green Energy

(source:climatevisuals.org)

China and the U.S. have conducted bilateral cooperation on renewable energy technologies and policy, which has been carried out through official government channels in the selected universities and NGOs. Over more than two decades, the China Environment Forum (CEF), an extension of the U.S.-China cooperation on energy, environment, and sustainable development challenges, has been the main platform to bring together policy, business, research, and NGO practitioners to discuss the most pressing pollution, water and energy issues facing China. Both sides have also established $150 million U.S.-China Clean Energy Research Center funded in equal parts by Beijing and Washington.

In 1979, the U.S. Department of Energy (DoE) and the Chinese State Development Planning Commission (SDPC) signed an MoU for Bilateral Energy Agreements, which includes 19 cooperative deals and serve to bolster renewable energy development, promote energy efficiency and conservation, and cut down emissions from coal-based power generation. The DoE also signed agreements with several government agencies in China to create a plan for mapping the country’s renewable energy resources and developing financing strategies for U.S. renewable energy projects in China. Further agreements were later signed by the U.S. Department of Agriculture (USDA) and DoE with China’s National Development and Reform Commission (NDRC) to enable collaboration on biomass and feedstock production and sustainability, conversion technology and engineering, bio-based product development and standards, as well as rural and agricultural development strategies. At the beginning of the last decade there was a dramatic increase in the number of bilateral clean energy and climate change agreements signed between the two countries although there has been difficulties in implementation, not to mention the Trump era setbacks.

“Cooperation between the United States and China can greatly accelerate progress on clean energy technologies, benefiting both countries,” said Steven Chu, former U.S. Secretary of Energy (2009-13) and a Nobel laureate. “We are committed to working with Chinese partners to promote a sustainable energy future. Working together, we can accomplish more than acting alone,” he added.

With the Biden administration, bilateral cooperation on clean energy is expectedto start again. Calls for a more engaging global collaboration on energy efficiency, renewable energy, and clean energy technologies are growing worldwide. The current achievements by China on green energy technologies set a standard for many countries to follow in the coming years. Whether the U.S. will choose cooperation or competition in this field will set the stage in achieving sustainable energy for all in the years to come.

2.6 Cooperation on Regional Hotspots

As seen in the past, the election of a new U.S. president always prompts mixed blessings and reaction. The swearing-in of Joe Biden as the new U.S. president in January 2021 was no exception.

The United States’ return to engagement with such initiatives as the Paris Agreement, the World Health Organization, and possibly the Iran nuclear deal has been applauded. However, its strategic approaches to critical security issues from North Korea to Myanmar to the Middle East, among others, demand scrutiny. If Washington chooses to confront any powers, especially China, it will be counterproductive and mirror the Donald Trump administration’s trade and security antagonism. However, there are many flashpoints for which the two countries can cooperate rather than compete to facilitate peaceful solutions. Below are some regional hotspots demanding U.S.-China cooperation and constructive approaches.

1-Myanmar

Over 500 people have been killed in Myanmar since February 1 in a struggle between the military and civilians. While the Association of Southeast Asian Nations (ASEAN) is constrained by its non-interference principle, the extended process of finding solutions at the United Nations (UN) Security Council and other fora only increases casualty records. Blame games over whom should be held accountable is an outdated approach for superpowers, especially the U.S. and China, and it will not help advance their global roles.

No party has managed to resolve the Myanmar crisis over the last two decades, largely due to its complex historical roots and internal ethnic divisions. The approaches of China and the U.S. to the crisis diverge: China prefers gradual adjustment through economic diplomacy while the U.S. seeks speedy liberal regime change. In general U.S. sanctions, or the threat thereof, packaged as part of its human rights and democracy safeguarding mission, have proven counterproductive and often buoy anti-U.S. sentiment in countries such as Iran, Syria, and North Korea. Likewise, China’s soft economic diplomacy can delay solutions to conflicts which hinders the ambition of its Belt and Road Initiative, deteriorate Chinese investment climates, and, in the case of Myanmar, disrupt its access to the Indian Ocean.

China and the U.S. must take into account certain factors in seeking a cooperative solution to the Myanmar problem. First, the root of conflict can be seen as not purely political but also ethnic, as there have been ethnic rebellions for respective autonomy. Second, the military junta is not currently subordinate to the will of any outsiders. While the U.S. and its allies are threatening sanctions and issuing condemnations, China is also backing calls for the military to release of elected State Counsellor Aung San Suu Kyi and for a return to democracy. A strategic engagement by the U.S. and China could be framed by the U.S. calling on civilians and China calling on ethnic groups for dialogue with the junta, which would prevent any third parties fueling their confrontations by backing the current civil disobedience. While the junta seeks to hold onto power, its ultimate goal is arguably a stable Myanmar with controllable territory and minimized aspirations for ethnic autonomy.

(source:CGTN)

The fact that during Aung San Suu Kyi’s democratic rule, between 2016 and 2021, Western leaders and commentators condemned the persecution of Myanmar’s Rohingya suggests that Western solutions are not fit for this ethnically divided Asian state.

China and U.S. should, therefore, work together as coordinators for unification rather than as the enforcers of any particular value or doctrine that may not fit with the realities of Myanmar. A U.S.-China cooperative effort to bring peace to Myanmar would deprive all parties of external leverage and encourage them to negotiate. A neo-realism lens is also applicable here: China and the U.S. could jointly work at regional (ASEAN) and global (UN) fora to convince other states under their respective influence to help construct a positive atmosphere in and around Myanmar, by coordinating, lobbying, mediating, or at worst pressuring the parties to drop violence for dialogue. The present unrest in Myanmar is partly fueled by the regional political differences around its borders. With possible regional and global reactions in the same fashion, the junta, which has pledged to hold re-elections, would no longer find any reason for clinging onto power as it has been doing in the vacuum left by the deadlock at ASEAN and the patronizing approaches of the West.

2-North Korea

Kim Jong-un and Donald Trump (source:BBC)

The historic summits between Donald Trump and Kim Jong-un in 2018 and 2019 were symbolic rather than substantive; concrete objectives did not materialize. A shared Washington-Beijing approach to dealing with Pyongyang seems inconceivable given their traditionally competing strategic interests in the peninsula since the 1950s. However, examining the current global context suggests a slightly different story. It is conventionally believed that China has substantial influence on North Korea, but Pyongyang is only likely to soften its behavior if the right incentives are provided by Washington, not Beijing – that is, if the U.S. lifts sanctions and quits the Washington- Seoul military alliance.

The Biden administration appears to be crafting a careful strategy toward North Korea. However, the persistent U.S. goal of forcing North Korea into a complete, verifiable, and irreversible denuclearization (CVID) has little prospect of fruition, because Pyongyang sees nuclearization as its only tool for regime survival. Moreover, any maximum-pressure approach by the U.S. toward North Korea would preclude Beijing-Washington cooperation as China would view any changes in the peninsula’s security settings as having a domino effect that would undermine its influence in East Asia. Further pressure would also help fuel Pyongyang’s hostility towards neighboring U.S. allies– Japan and South Korea.

There is one area in which the U.S. and China could work together, as can be drawn from the convincing lesson presented by the first regionalism in Europe in the 1950s, which largely ended inter-European warmongering.While applying interdependence theory to North Korea is implausible at this stage, engaging North Korea with economic linkages while pausing—rather than putting an end to—its nuclear program will encourage its sense of playing a positive role and nudge its leaders to relax its nuclearization ambitions. The United States’ gain from this approach is that it would leave space for its allies Japan and South Korea to constructively engage North Korea through economic diplomacy with gradual political adjustment. In a meeting with

his then Chinese counterpart in 2012, Kim pledged that developing the economy and improving people’s livelihoods was the goal of the Workers Party.

If done successfully, this approach could transform North Korea’s economy into a Western-style free market and give the West a share of China’s near monopoly over trade with North Korea. With Western economic sanctions partly or substantially relaxed, Pyongyang would not insist on pausing U.S.-Japan or U.S.-South Korea military cooperation. A more liberal Pyongyang would also ease international pressure on Beijing over North Korea’s nuclear program, and China’s economic and investment opportunities in North Korea will only multiply once the country is more economically open. Though this option seems to be far from current U.S. considerations under the Biden administration, which emphasizes strategies for advancing U.S. interests, a critical assessment of the failures of the West’s previous maximum-pressure measures should provide food for thought regarding alternative options with better long-term prospects.

3-Iran

The U.S. airstrikes on Iran in February 2021 and Biden’s refusal to partially lift sanctions signaled that Washington is continuing its hostile and confrontational approach towards Tehran. China has adopted a strategic approach toward filling the vacuum thus created by signing the 25-year China-Iran deal in March, with cooperation areas ranging from investment to security and intelligence. This deepens Beijing-Tehran ties and brings a China dimension into U.S.-Iran negotiations. On a recent visit to Tehran, Chinese Foreign Minister Wang Yi stated that China firmly supports Iran in safeguarding its state sovereignty and national dignity. However, he has also explicitly stated that Beijing will always welcome Washington’s return to the Iran nuclear deal, abandoned by Trump in 2018.

In a surprise move in late March 2021, the U.S. expressed interest in cooperating with China to stop Iran’s nuclear program. “Competition, as you know, does define our relationship with China, but we do have, in some cases, rather narrow areas of tactical alignment,” said State Department Spokesperson Ned Price. Although this statement came on the heels of the China-Iran deal, it does signal hope for cooperation.

A solution to the problem will become more viable if Washington and Beijing can reach a compromise. China can use its influence and strategic partnership with Iran to convince Tehran to take a more conciliatory approach to the nuclear talks, while Washington can help by relaxing its sanctions to provide an incentive. China could act as an intermediary, if the U.S. softens its hawkish attitude to facilitate that role. Ensuring a future nuclear-free Iran for all could be an exemplary area of cooperation for China and the U.S. while relieving the world at large.

The U.S. and China could subsequently use this positive atmosphere to help cooperate on tackling other regional issues across the Middle East.

2.7 Counterterrorism

As the United States and China both expand their global footprints, both powers become increasingly susceptible to threats of terrorism. Terrorism serves as a threat to the millions of Americans and Chinese citizens living abroad, as well as the vast commercial interests belonging to each country. With the United States and China competing for influence and power globally, the U.S. and China would both benefit from an improved security situation, providing the two powers with an opportunity to find common interests and work together. Despite their differences in foreign policy approaches and objectives, neither the U.S. nor China would benefit from regional or global instability.

Historically, China has been considered to have a greater interest in focusing on its domestic security situation rather than the stability of regions outside of its borders. Some scholars have even gone to lengths of describing China’s counterterrorism policy as constrained, as the Chinese government prefers to remain loyal to its principles of nonintervention and noninterference. As China’s focus has shifted from a concentration on domestic development to one of expanding its global trade network, China can benefit from deepening its cooperation in the field of counterterrorism with the United States to ultimately promote regional stability in export markets crucial for its financial success.

China continues to address the global threat of terrorism through both multilateral and bilateral initiatives. China participates in the Shanghai Cooperation Organization, the China-Arab States Cooperation Forum, and in several United Nations projects, namely as a permanent member of the Counterterrorism Implementation Taskforce. China also belongs to regional organizations including the Association of Southeast Asian Nations (ASEAN) Regional Forum (ARF), ASEAN Plus 3, and the Asia- Pacific Economic Cooperation (APEC).

After the terror attacks on the World Trade Center in New York City on September 11, 2001, China and the United States, the two largest economies, began to cooperate in counterterrorism efforts in ways that protected each country’s interests. China began to directly engage with the United States through the U.S. Container Security Initiative, airline passenger screening cooperation, and the Megaports project, an initiative with the objective of detecting traces of nuclear and radioactive elements in some of the world’s largest maritime ports.

Terror attacks have devastating effects (source:sina.com)

Using this as a background, it may be possible to conclude that the United States and China’s cooperation in the sphere of counterterrorism efforts is one of few sectors that has transcended the deterioration of the relationship between the two countries. While the U.S. and China may have different reasons for supporting improvements in security situations in particular regions, the fact that neither country would benefit from instability should be a strong enough reason for the two countries to put aside any political differences and work together.

Regions with immense potential for cooperation between the United States and China include the Middle East and Africa. With the Biden Administration recently announcing the country’s departure from Afghanistan, where the United States has had a presence for more than two decades, this long-standing dependency on the United States for a security guarantee leaves a vacuum for domestic forces to harness instability for self-gain.

The U.S. wants to leave behind a conflict typically referred to as an ‘endless war’ and intends to only leave behind private contractors to monitor the situation. While China may not have an obvious interest in Afghanistan, it should be concerned about regional security and the threat of a resurgence of terror activity due to its level of investment in neighboring Pakistan. Pakistan, which is often referred to as a country with which China has friendly and long-lasting ties, is highly exposed to any spillover effects from Afghanistan. As the U.S. seeks to avoid reengagement in Afghanistan, China should take preventative measures to contribute to maintaining stability in Afghanistan in order to protect its Belt and Road projects and the security of Pakistan as a corridor connecting Asia and the Middle East to Africa and beyond.

The United States and China also have the opportunity, as well as an incentive, to work together to address terror groups that affect the interests of both countries, particularly the Islamic State movement. The U.S. has significant experience in countering and containing Islamic State fighters in the Middle East. Recently, a wave of extremism violence has swept across Africa, and Islamic State has recently emerged as a force in both the Sahel and sub-Saharan Africa. China is one of the most active investors in Africa, so it naturally has a desire to protect its commercial

interests as well as its own citizens living abroad. While the U.S. does not have as strong of a financial interest in Africa, it would likely want to prevent a resurgence of this movement in the Middle East, and therefore could use this as an opportunity to work hand in hand with China and share experience and intelligence and contribute to the eradication of the movement.

China and Chinese companies possess very valuable trade relations with both the Middle East and Africa. China, which is the world’s largest importer of oil, imports approximately 70% of its oil from the Middle East and sub-Saharan Africa. Additionally, the International Monetary Fund estimates that China exports $155 billion of products to the Middle East and $83 billion worth of goods to sub-Saharan Africa.

Expecting China and the U.S. to achieve a widespread, comprehensive agreement on counterterrorism measures is unrealistic. Efforts towards developing cooperation between the United States and China should instead be based on situations where both countries share interests and expertise. Because the U.S. and China are the two largest commercial forces in the world, it would be best for these powers to focus on issues of shared interest that are primarily based on economic issues and transportation, which are perhaps less political than other sectors.

2.8 Financial Crisis Mitigation

Much like some other issues, the United States and China may have different priorities in and approaches to financial policy management, but on a global level, it is in the interests of both countries to promote and maintain economic stability. Both China and the United States have a stake in a stable and thriving global economy and financial system. The cooperation during the 2008 financial crisis is a testament to it although China, due to its own economic development level and characteristics, were shielded from many effects of it. The financial authorities of China and the U.S. have long worked together on bilateral and multilateral basis within the framework of the International Monetary Fund and G20. The bilateral engagement took part through the Strategic Economic Dialogue, later renamed Strategic and Economic Dialogue.

The 1997 Asian and 2008 global financial crises have shown the value of coordinated approach and unified responses in tackling economic and financial problems.

(source:unsplash.com)

Economic engagement between China and the U.S. is not a choice but a necessity and keeping communication channels open coupled with result-oriented dialogue would benefit not only the two countries but also the global economy. Abstaining from multilateral cooperation gives rise to regionalism and isolates the party that chooses disengagement as in the case of the Regional Comprehensive Economic Partnership (RCEP) trade agreement which has brought together China and some U.S. allies, but not the U.S.

Disengaging China, given the size of its economy and its centrality to global trade, would not serve the U.S. interests. China has been taking meaningful measures to reform its financial market and integrates its regulatory framework with that of the global financial markets. It is only through communication, engagement and cooperation can the West gain insights into Chinese economic and financial management style and decision-making process rather than guessing as outsiders, which is critical in times of crisis.

As U.S. President Joe Biden seeks reengagement with the rest of the world, his administration has introduced policies that are seemingly more conducive towards multilateral approaches and mechanisms. One such measure has been U.S. Treasury Secretary Janet Yellen’s introduction for issuing $650 billion in Special Drawing Rights (SDR), an idea that was blocked by former President Donald Trump. The plan of introducing $650 billion of SDR, the ‘reserve asset’ of the International Monetary Fund, has positive implications for the economies of poor and developing countries in particular, enhancing their economic security and stability and helping with poverty alleviation. It goes without saying that China’s spectacular success in poverty reduction can also set a model for the rest of the world and Beijing has much to offer to a cooperative work in this area.

The details of the U.S. plan have not been fully established, but Washington has proposed that countries not requiring their allocated SDRs may lend them to other countries or institutions, including multilateral banks. This is an idea that China has expressed support for, meaning that both the U.S. and China could tentatively reallocate some of their SDR shares in a coordinated effort to address challenges to global financial stability, especially in developing countries.

Under such an initiative, the United States could encourage China to use its unique position in global financial governance platforms for good. Focusing on cooperation, the U.S. should seek to engage with China on this issue: Beijing is willing to support the proposal, and China also has the ability to form strong coalitions with other emerging market economies, such as the BRICS.Such countries are large enough where their economic health affects the stability of global markets, but they often lack diversification, exposing the world economy to instability occasionally.

In this specific instance, China and the U.S. can work together to promote global financial stability and prevent, or lessen the severity, of future financial crises. The Biden administration’s introduction of this SDR proposal signals a willingness to reengage with the international community, and China can use its place in the IMF and G20 to continue its advocacy for new economic players and emerging economies. By working together to promote access to financing for development, the U.S. and China would be leading an effort to help emerging economies diversify away from a single or handful of sources of revenues, to well-developed, comprehensive, and stable economies, thus avoiding economic and financial instability in the long term.

(Contributors to this article: Marco Carrasco, Austin Clayton, Bunthorn Sok)

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Friend or Foe? Cooperation & Competition in China-U.S. Relations (Part I)