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For whatever reasons, that Washington decided to postpone raising its tariff rate to 30 percent, an unprecedented level, on $250 billion worth of Chinese imports from its planned Oct 1 to Oct 15 is a welcome sign. Except the periods immediately following the Chinese and U.S. leaders' meetings in Buenos Aires, Argentina, in December, and in Osaka, Japan, in June-both of which proved crucial to pulling the two back to negotiation tables-this is the first time that the U.S. administration has taken the initiative to show its goodwill, which allegedly echoes the olive branch extended by China on Wednesday to exclude 16 categories of U.S. goods from its retaliatory tariffs for a year. The long-anticipated reciprocity shows, despite continuous escalating of tensions, that neither Washington nor Beijing has lost their marbles and both look forward to striking a deal at an early date to avoid overreaching the "art of the deal". After about 18 months in a seesaw battle, Washington should have realized Beijing's determination to safeguard its core interests at all costs-not to mention that Beijing has exercised great restraint in its compelled countermeasures-and that Beijing has also been fully aware of its situation-with Washington's maximum pressure, it has nowhere to retreat. So there is no doubt that China will see the trade war through to its very end, if the U.S. is intent on turning it into a life-or-death struggle. Against this backdrop, it is better for the doer to undo what it has done, as neither side will be left unscathed. Like it or not, Washington has to swallow the bitter fact that its "maximum pressure" tactics do not work on China. Instead, such tactics have held the whole U.S. economy as hostage of its strategic miscalculation, as China can find substitutes of U.S. imports more easily than the other way around. Although it is too early to predict whether this move by the U.S. will change the course of the whole situation, it has indeed created a window of opportunity for the two sides, standing again at a crossroads, to carry on the momentum to try to address their differences and rebuild their mutual trust. If they can take further steps to continue to dismantle the bulwarks they have constructed, the tensions that have been built up over months can be vented gradually, thus creating a positive atmosphere for their scheduled talks next month. In other words, if Beijing and Washington can make concerted efforts to rebuild their mutual trust, and mutual respect, they will provide themselves with not only fresh opportunities but also new angles to re-evaluate their differences, which can either be the cause of conflicts between foes, or the source of complementarities between partners. Otherwise, the situation will once again return to where it was. |
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