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China-US relations

Prepare for another roller-coaster year of global brinkmanship

  • Trade conflict, fear of China’s rise and a surge in populist intolerance and nationalism could fuel dangerous times
PUBLISHED : Monday, 31 December, 2018, 6:04pm
UPDATED : Monday, 31 December, 2018, 8:43pm

Last year was so memorable for events that shook summit diplomacy, redefined the gender balance and inspired awe at a miracle of survival against the odds, that it is hard to imagine the new year making as big a splash. But signs are abundant that it may be too soon to write off the year beginning today – incidentally the 40th anniversary of the normalisation of China-United States relations – as anticlimactic. News of a pre-new year phone call between President Xi Jinping and his US counterpart Donald Trump has added momentum to a thawing in bilateral relations since the two agreed on a 90-day truce in their trade war on December 1. Both sides spoke positively later of progress and the importance of the China-US relationship, setting the stage for talks between officials beginning next week to pave the way for a deal to end the war by the deadline of March 1.

Trump launched the trade war a year ago this month with tariffs on imported washing machines and solar panels, followed eventually by tit-for-tat tariffs by the US and China on hundreds of billions of dollars worth of imports. He was delivering on a promise to conduct a radically different “America first” foreign policy also exemplified by withdrawals from the Iran nuclear deal, a global climate agreement and a multilateral trade pact, and confrontational summitry that was critical of other prominent G20 leaders. That said, it also resulted in Trump agreeing to historic talks – without preconditions – with North Korea’s Kim Jong-un. Xi confirmed at the weekend that he strongly encouraged and supported further talks.

Asia in 2019: buckle up for a year of uncertainty and volatility

There were at the same time compelling distractions from strife and Trump’s brinkmanship. The most enduring is the #MeToo movement against the sexual abuse of women that has gone global after allegations against Hollywood producer Harvey Weinstein, as countless women come forward with their stories. One case in Hong Kong ended in court and the acquittal of an athletics coach accused of sexual assault. Another event last year that will be remembered long after most are forgotten is the miraculous underwater rescue by divers of an entire Thai boys soccer team trapped in a flooded cave.

March is not only a deadline for an agreement between China and the US during the current trade war truce, but also for a deal to avoid a chaotic British exit from the European Union. A failure in the first would test global business and investor confidence; failure in the second would be a leap into the unknown for Britain, the world’s fifth largest economy. Having just celebrated the 40th anniversary of reform and opening up, China has to adapt the lessons of the past to face future challenges – and [even] “unimaginable” but unnamed perils, according to Xi. Trade conflict, fear of China’s rise and a surge in populist intolerance and nationalism could fuel dangerous times.