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Bush, Hu Talk Trade

Prepared by: Esther Pan
Updated: April 20, 2006

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Hu Jintao meets George Bush at the White House for talks focusing on the growing U.S.-China trade deficit, China's growing demand for oil, intellectual property rights,and human rights. The two leaders vowed cooperation on issues including North Korea and Iran before getting down to business. Ahead of Hu’s trip, a Chinese trade delegation to the United States contracted $16.2 billion in American goods and announced a clampdown on piracy (CSMonitor). But despite Chinese efforts to appear conciliatory, these measures alone are unlikely to satisfy China's American critics (Economist). Frederick Kempe writes in the Wall Street Journal that fears about China’s rise are linked to the perception that the Asian giant "is gaining global influence faster than a sense of responsibility about how to deal with it." China's huge but uneasy trade relationship with the United States is examined in this new CFR Background Q&A.

Council Senior Fellow Elizabeth Economy tells cfr.org's Bernard Gwertzman in this interview that China's agenda for the meeting includes public acknowledgement of its status as a significant world player. Since 2003, China's foreign policy has been formulated according to its "peaceful rise" policy. This states that China will develop economically in a peaceful international environment while maintaining and contributing to world peace. The implications of the idea, first articulated by Chinese scholar and political adviser Zheng Bijian, are examined in this CFR Background Q&A. Experts say the policy came about after China's leaders recognized that to ensure continued economic growth and domestic stability—their two highest priorities—they had to reassure the rest of the world, and particularly Asia, of their peaceful intentions. The efforts are bearing fruit: the official Xinhua news agency says China-U.S. ties are maturing.    

One thing critics don’t argue about is China ’s growth: China ’s economy grew 10.2 % in the first quarter (Xinhua). The Wall Street Journal points out that China ’s economic rise has serious benefits for the United States as well, keeping prices for consumers low and subsidizing U.S. spending and expansion. Anouar Abdel-Malek writes in Egypt's Al-Ahram that China's example of economic liberalization with gradual political reforms is one the Arab world should emulate. But Humphrey Hawksley of the BBC writes that China's growing influence in Brazil, where it presents its "peaceful rise" policy as a better model for poverty reduction than American-style capitalism, is prompting concern from Washington.

Some observers are commenting on the underlying instability of China's rise. In a Foreign Policy article, Minxin Pei of the Carnegie Endowment for International Peace details the ways the authoritarian state is a "parasite" on the economy. The China Post writes in an editorial that "China pays a huge price for its peaceful rise" and cites the growing gap between rich and poor and rampant environmental degradation as threats to the country's development. Zheng, the architect of the "peaceful rise" policy, writes in Foreign Affairs that China's challenges include a shortage of natural resources and a lack of coordination between economic and social development. The Brookings Institution offers a collection of Zheng's speeches in which he outlines the policy and how to present it to the world.

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