The US and China slightly downsized their egos and decided to conduct frequent meetings relating to the economic issues and restrictions on the import and export of advanced technologies. This is a great achievement in terms of easing the tensions between the world’s top two largest economies, which were engaged in a trade war for quite a long time.
Gina Raimondo, the United States Commerce Secretary, was on a visit to Beijing to meet her counterparts and other Chinese officials in Beijing and Shanghai. The announcement was made during this meeting. Earlier, Treasury Secretary Janet Yellen visited Beijing with the agenda of renewing the hampered communication in recent times.
In the last ten weeks, the White House has been sending high-ranking officials to Beijing to restore bilateral ties. Secretary of State Anthony J. Blinken, President’s climate envoy John Kerry, and many others had collectively conducted three trips. The agreement to hold frequent discussions happens to be the latest and most significant development of these visits.
Raimondo said in a press conference after her negotiations meeting with the Chinese commerce minister, Wang Wentao, that both sides have agreed to set up a dialogue that will be used as an official channel for further talks.
While in Beijing, she described her meeting with Wentao as open and pragmatic. Discussions were made on topics related to the concerns of the American business community about Chinese actions against Intel and Micron Technology, two semiconductor giants in the United States.
China had foiled a merger worth $5.4 billion between Intel and Tower Semiconductor, an Israeli chip maker, by delaying the review of antitrust laws, making them miss the merger deadline. It had also asked its domestic company that deals with Micron to halt its purchases of products from the company.
Raimondo said that there would be two sets of dialogues established for different purposes. One would be a group of business representatives and would look after the commercial matters. The other one would be a channel for the exchange of information on a governmental level on United States enforcement for its export controls.
The United States and China are both interdependent on each other for trading activities. Diplomatic-level discussions about trade, technology, and other commercial interests were common between the two nations, but those talks took a hit in recent years.
China went strongly after these bilateral talks and completely stopped eight such channels after Representative Nancy Pelosi, D-California, who was also the then House Speaker, visited Taiwan almost a year ago.
A Chinese spy balloon spotted flying over American land was shot down in the Atlantic Ocean, poured fuel over the expanding divide, and also resulted in the cancellation of Blinken’s trip to Beijing.
According to the Chinese ministry readout, they are eager to work in tandem with the White House officials to establish meaningful policies benefiting businesses of both countries.
Wentao has displayed serious concerns about the United States tariffs on Chinese imports and especially the Biden administration’s efforts to boost the indigenous semiconductor industry by substantially subsidising the companies. He has criticised those subsidy programs and labelled them as discriminatory towards Chinese companies.
In the past eight months, Chinese officials have permitted inspection for over 100 industrial inspections. These inspections are to be conducted by American officials from the export enforcement group to determine that the imported American advanced technologies are not used in the development and upgradation of the Chinese military. The United States Commerce Department announced that 27 Chinese companies have passed such inspections and have been allowed to import advanced technology.
Republican lawmakers have criticised Raimondo for setting up a working group comprising officials from both nations to ponder upon American export controls. Before her visit, four Republicans argued in their letter that it is deeply concerning that their arch-rival has a say in the export controls levied on national security technologies.
Raimondo clarified in a public announcement that the new dialogue is working as an information exchange rather than a working group. She said that it had been established just to share information about the export controls on advanced technology and that there is no room for any compromise on United States national security. For this dialogue, Raimondo and the Chinese commerce minister have agreed to meet once annually.
There are still questions that remain unanswered regarding the success of the established dialogues. Considering the fragile condition of the political relations between the two countries, a formal dialogue structure was criticised by Chinese analysts in the United States.
Matt Turpin, a visiting fellow at the Hoover Institution, who was also the China director of the National Security Council during the Trump administration, highlighted that China has denied taking action to halt the supply of fentanyl in the United States. It has recently nurtured its relationship with Russia and has also hacked Raimondo’s email account right before the trip, and these reasons make it ineligible for such talks.
Raimondo said that she had talked with over 150 business leaders before preparing for the trip, and all they wanted was more channels of communication. American businesses and investors were caught off guard by the unfair requirements of the Chinese government and the rapidly decreasing transparency in Chinese economic statistics. This has hampered businesses, and the only solution available to them is negotiations.