Biden’s economic diplomacy push with China sends high risk, low reward

WASHINGTON: The US is already walking on the edge of the knife of financial recovery and President Joe Biden’s economic diplomacy push with China is putting the country at high risk with low reward, Josh Rogin writes in The New York Times.

Biden has announced that he will be running for a second term in office and the Ukraine war and inflation are just like the salt on the open wounds. And on top of that Biden is doubling down on his push for economic engagement with Beijing.

The author believed that raising the economic pressure on China in the current environment would carry its own risks. In fact, some observers praise Biden’s “course correction,” while others point out that outreach is unlikely to produce results because the administration is not prepared to concede to Beijing’s demands to back off on tariffs, technology restrictions and bans on products made with forced labour.

Many national security officials see weaknesses in Biden’s strategy to apply economic pressure on China. For example, an earlier plan to investigate China’s abuse of government subsidies has been dropped. And six months after the administration announced new technology export restrictions on China, final rules to carry out those limits have yet to be released. If the administration has any serious plan to address China’s abuse of U.S. capital markets, it’s a closely held secret, according to The New York Times.

Regarding China, there is tension between Biden’s interest in maintaining a tough stance and his desire to slow the rapid descent of the relationship. Meanwhile, China courts European allies in an attempt to isolate Washington.

The author, citing officials, said that Biden seeks another meeting with Chinese President Xi Jinping to follow up on their confab last November in Bali, Indonesia. But the strategic-engagement track has been frozen ever since Secretary of State Antony Blinken’s planned trip was scuttled by the spy balloon incident in February.

At this point, Xi won’t even accept a phone call from the American president. But his government has told the Biden administration that it wants to resume economic discussions. This has provided an opening for Biden’s economic officials to step forward.

Meanwhile, the United States should seek engagement and competition with China simultaneously. But Beijing is trying to force Biden to prioritize the former over the latter. The problem with going along is that until the United States addresses China’s economic aggression, it can expect neither fair competition nor security, reported The New York Times.