from Asia Unbound

The Decade’s Top Ten Game-Changers in U.S.-China Relations

December 21, 2009

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It’s the end of the year, and end of a decade, and we here at Asia Unbound are not immune to the easy lure of the “Top Ten” list. OK, it’s not the Top Ten “Accidental Celebrities” or “Cultural Moments” Newsweek has on offer, but below are the ten most important game-changers in U.S.-China relations from the last decade.

Copenhagen (December 2009): The world’s number one and number two emitters of the greenhouse gas carbon dioxide (CO2)—that would be China and the United States, respectively—threatened to hold up a new global framework for climate change. Both pledged to do too little while asking too much of the other. In the end, consensus was reached but only after President Obama (just about literally) broke down the door on some secret Chinese negotiations with the Brazilians, South Africans, and Indians. Truth be told, throughout the negotiations, the Chinese seemed not at all interested in working with the United States. Should we have been surprised? See below.

Hu Hosts Obama (November 2009): Awkwardness personified. From the press conference with no questions to the town hall with no town, the first visit of President Obama to Beijing was a sad reminder of just how far our two countries have to go. While many pundits opined that boxing in President Obama was a sign of rising Chinese strength, we’re of the opinion that the Chinese lost big by trying to make the U.S. President look small. When the Chinese have truly arrived, such pettiness will be well beyond them.

The Internet: Few would have predicted that China would finish the decade as the world’s largest internet playground. From 8 million users a decade ago to 359 million today, the Chinese talk, shop, and play on the web, just like users everywhere. Of course, the Chinese government can’t quite accept it all—no Facebook, no Twitter, and continued efforts to verify all the users (wish they’d do this on climate change instead). Still, we’ve watched in awe as environmentalists have rallied, human rights activists have linked up, and bloggers have written about everything that pops into their heads. The next decade only promises more excitement on this front.

Global Financial Crisis (2008-Present): A $586 billion stimulus package seems to have done wonders for the Chinese economy. Growth for 2009 is predicted at well-over 8 percent, while the U.S. recovery has been tepid; as a result, China’s economy has grown from one-fourth to one-third that of the United States in just one year. Emboldened by their management of the crisis, China’s economic decision makers are looking forward to a new world economic order, if not exactly volunteering to be the first to help build it. A March 2009 paper by People’s Bank of China Governor Zhou Xiaochuan suggested that the dollar would eventually be replaced as the world’s reserve currency. Lurking in the wings, however, are overproduction, uncontrolled bank lending, and rising debt, and we think the shift from an export-led to a domestic demand driven model of economic growth will be long and bumpy.

Charter 08 (December 2008): Signed so far by over ten thousand people, the Charter calls the government’s approach to modernization “disastrous” and calls for a sharp turn “toward a system of liberties, democracy, and the rule of law.” The organizers, Zhang Zuhua, Liu Xiaobo and Wang Debang, have been harassed by the police, and in December 2009, Liu was charged with subversion and faces fifteen years in prison. There were some predictions early on that Hu Jintao, Wen Jiabao and other highly educated, technocratic members of the inner party might tackle political reform; these expectations, as Liu can attest, proved to be illusory. Will Xi Jinping, Li Keqiang, Li Yuanchao and the rest of the fifth generation chart a more radical course once they take power in 2012?

Olympics (August 8, 2008): No one event so clearly encompasses all the paradoxes and challenges of China’s rise. The Bird’s Nest, the Water Cube, and the opening ceremonies were jaw-dropping spectacles. Yet equally revealing of the new China were Beijing’s restriction of protests to three parks (and subsequent arrests of petitioners) and its Olympic-sized cover up of the scandal surrounding the sale of milk powder contaminated with melamine (which had first broken in June).

Election of Ma Ying-jeou (March 2008): Policy makers in Beijing and Washington breathed a sigh of relief with the election of this Harvard-educated pragmatist. Unlike his predecessor, the independence-minded Chen Shui-bian, Ma has focused on trade and travel rather than Taiwanese identity and independence. It is not all good feelings—Beijing is still targeting roughly one thousand short-range missiles at the island and the United States just announced it will move forward with arms sales to Taiwan—but Ma has given both Beijing and Washington a little room to breathe on this perpetually thorny problem.

SARS (2003) to H1N1 (2009): After incurring the wrath of the rest of the world for failing to acknowledge the spread of the deadly SARS virus in 2003, China’s leaders turned a new page when it came to the 2009 Swine Flu. Vaccines were pushed from research to development to distribution in record time, while passengers from around the world endured strict—some would say over-the-top—monitoring and quarantining. Still, questions remain as to China’s abnormally low infection rates. Maybe they’ve only turned half a page.

September 11, 2001: Before the terrorist attacks, Sino-U.S. relations seemed to be on a collision course (see, for example, the literal collision of an American EP3 and a Chinese fighter off of Hainan on April 1, 2001). Former President Jiang Zemin expressed his condolences on the night of the attack, and in the weeks and months after, China coordinated with the United States on counter-terrorism, was generally supportive of the war against Al-Qaeda and the Taliban, and donated $150 million to Afghanistan for development. Over the last eight years, in part because of the massive challenges in Iraq and AfPak, the United States rarely discusses China as a potential peer competitor, but instead “welcomes China’s efforts in playing a greater role on the world stage,” in the words of President Obama.

Going Global (1999): While technically not of this decade, almost nothing transformed China’s role in the world more than Jiang Zemin’s decision to encourage outbound investment. As Chinese loans and investment dollars in Africa, Latin American and Southeast Asia mounted, China became the go-to banker for much of the world. Promises to do business and not mess in internal politics also made China many new friends. After a decade of such deals, however, not everyone in the developing world is so welcoming. Chinese money that props up the regional bad guys or incurs serious environmental and labor problems may come at too high a price.