OPINIONS The pendulum of trade


The pendulum of trade


04:31, January 31, 2019


(Photo: CGTN)

What is bending history?

Logic does not convince people, pain does. The US and China have called a temporary ceasefire. Although clear-headed people once warned of the risks in the trade war, no one wanted to blink first…until punishing pain kicked in. 

2018 was the worst year for US stocks in a decade, with the worst December since the Great Depression. Meanwhile, China saw a slowdown in growth of investment, consumer spending and factory activity.

Trade tensions should not take the full blame. But what is painful is not a future we know, but what we don't know.  And nobody knows if and when the Americans and the Chinese would play nice.

A rivalry of rhetoric

But we do know structure dictates function. China is like a plant, it grows because it needs to, although a little rain, some bugs or strong wind might help or harm. In the end, it is the genetics that rules. The genetics of China is to survive and thrive.

China's reigning rhetoric is reform and opening-up, but should it apply to other countries as well? Of course, China needs to transform its economic governance and rule of law. 

But let us flip the coin, America is the lazy partner in the dance. Partisan bickering has sucked up all the oxygen, and Americans are falling short of real reform: its economic policies are unsustainable, industrial capacity is deteriorating, and investment in infrastructure and education is insufficient. America can be great, but will it?

Both the US and China have been locked in a rivalry of rhetoric and counteraction. Is it “Make America great again"? Or "Rejuvenation of the Chinese nation"? But is China-America relations a race?

Yes and no.

The pendulum swings

Yes, because there is always competition among peoples, tribes, countries and cultures. It is how history began and it will continue to be a part of history. China and America are different and devoted, and they are bound to conflict in some ways.

And no, because this is a new age, an age of connectivity. It is wishful thinking that we can all retreat back to our own tribes, free from the rest of the world. There is no insider or outsider, there is only a good partner or bad partner. In the end, we are a cooperative species, even more so in a globalized era.

I am not so worried about a trade deal in 2019. The Trump administration is a transactional one, and there will be transactions between the US and China. But transactions are not cooperation. Cooperation is an organic process. And not everything is up for sale.

The pendulum of history swings from one extreme to another, sometimes unsettling but always moving. The case of Huawei makes a lot of people edgy. Will the West band together to resist Huawei's growth? Will China be cornered? 

Let us be patient, patience is what brought China where it is now, and it will lead the country ahead. As Churchill said, "No failure is fatal, no success is final, what counts is the courage to continue."

Chinese wisdom says extreme meets. Wait, the pendulum will swing back.

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