Key issues in Sino-US strategic dialogue

According to the Chinese Ambassador to the US, at this dialogue, leaders of 20 ministries and agencies will discuss security, politics, and economic and financial issues from a bilateral, regional and global perspective.

Prior to the dialogue, analysts said that this US-Sino Strategic and Economic Dialogue will prepare the ground for building a new type of super power relationship. But, it will be a difficult task impeded by differences on a number of issues that will have to be dealt with before any new relationship can emerge.

US and Chinese officials meet in Washington for the 5th US and China Strategic and Economic Dialogue (Photo:AFP)

One are of sharp disagreement is international trade. Although bilateral trade has increased 198fold since they established diplomatic ties 34 years ago, and trade turnover between the US and China rose from US$270 billion to nearly US$500 billion in the past five years.

This rapid increase of trade has given rise to disputes and mistrust. The gap between them has been widening. US investors in China face barriers and limitations affecting ownership rights in 90 separate areas. Meanwhile, Chinese investors in the US must grapple with unfavorable decisions by the US Congress and restrictions for security reasons.

The valuation of the Chinese yuan is another controversial issue undermining bilateral trade. The US has long insisted that China’s consistent undervaluation of the yuan is calculated to give Chinese enterprises an advantage in international trade.

In addition to the trade disputes, network security is another issue troubling Beijing and Washington. The Commission on the Theft of American Intellectual Property has estimated that the US economy loses approximately US$300 billion every year as a result of cyber attacks by hackers, particularly hackers in China.

The issue has become more complicated with Edward Snowden’s revelation that the US National Security Agency’s secret surveillance program has been targeting the computer networks of China’s Tsinghua University in Beijing and Hong Kong University.

At this year’s dialogue, China will expect an explanation from the US. According to the US State Department, Washington only wants to focus on the theft of trade information and intellectual property. This issue will certainly not be resolved at this dialogue.

The US’s sale of weapons to Taiwan has thrown a wrench into military relations between the two countries. Other regional and global issues include the denuclearization of the Korean peninsula and maritime disputes in East Asia. Washington claims to have a neutral role and denies any intermediary role in maritime disputes in East Asia and has called on all countries to settle their disputes peacefully and refrain from obstructing free navigation in the region. But Beijing insists that the Obama administration’s policy of rebalancing toward Asia has provided leverage to countries that feel dominated by China.

It is obvious that China and the US are searching for a new type of relationship. The highlight of their current relationship is a lack of strategic trust, which will hardly be remedied by a single US-China summit. The most that can be hoped is that the dialogue will help to minimize misunderstanding and keep bilateral relations from worsening.

The relationship between China and the US appears more balanced following last month’s talks between President Obama and President Xi Jinping in the US. Perhaps, greater respect and cooperation can be achieved at this dialogue. If so, a new type of partnership might be achievable in the future.