Trump And Xi Can Reach Mutually Agreeable Solutions On North Korea And Trade

china focus

SHANGHAI ? Rex Tillerson has just finished his East Asia tour as the U.S. secretary of state. The main purpose of his last stop and probably the most important one was to meet with Chinese leaders to prepare for the upcoming summit meeting between Chinese President Xi Jinping and U.S. President Donald Trump on Thursday and Friday at Trump?s Mar-a-Lago estate of Florida. 

In terms of substance, there are many areas to address for cooperation, including revitalizing the global economy and calibrating the Chinese dream and American dream, as well as their differences in dealing with the Taiwan issue, bilateral trade, the Korean Peninsula and certainly the South China Sea. Despite vast common economic interests between China and the U.S., the two countries remain divided as to how to manage their trade imbalance. Lately China has been enjoying a significant trade surplus at over $300 billion per year. Successive U.S. governments have been troubled by the rising imbalance and the associated job outflow to China.

The problem threatens to create a backlash against globalization. However, the solution is not to cut China?s exports to the U.S. but to increase China?s imports from the U.S. Even though the U.S. is vigilant in guarding access to its most sensitive technology, the U.S. still has much to offer, including its safe food and rich agricultural products.

The solution is not to cut China?s exports to the U.S. but to increase China?s imports from the U.S.

It is notable that from the second half of last year, China has taken strong measures to prevent its currency from further depreciating. While China has to do so to boost its own market confidence and to sustain the newly acquired status of renminbi as an international reserve currency in the International Monetary Fund, it has faced an ever-stronger pressure of export decline. Therefore, China?s effort to stabilize its currency deserves commending.

Beijing and Washington have to take a long-term strategic view, as Xi told Tillerson when they met in Beijing. It is important to enhance bilateral relations with strong social support, as this is the only sustainable approach toward, as Xi put it in the past, a ?new type of great power relationship,? which Tillerson echoed in Beijing.

In terms of the Taiwan issue, Tillerson?s reportedly rich experience in conducting business has made him well-acquainted with the importance of this unshakable position. Besides firmly honoring the ?one-China? policy, he is also right in recognizing, as he admitted during his East Asia debut, that the U.S. policy on North Korea in the past two decades, especially on Pyongyang?s nuclear program, has failed. Nevertheless, he has to be careful about stating that all U.S. options are now on the table; after all, the U.S. has no preemptive option in dealing with a nuclear-armed North Korea.

America has virtually accepted nuclear-armed Israel, India and Pakistan, all for realistic reasons, so it is impractical to state that the U.S. could consider all sorts of options toward North Korea. Further, America has normalized relations with Cuba, after boycotting Havana for over half a century. Since the U.S.?s preemption against Iraq has been a fiasco, any repetition of such against Pyongyang probably would hurt Washington more than Pyongyang. Tillerson should be cautious in understanding American realism, especially given Trump?s style to retract.

To stress denuclearizing North Korea as the precondition for talks only destroys any chance to talk and pushes Pyongyang farther along its nuclear path.

Having said this, it doesn?t indicate that one has to politically accept North Korea?s nuclear reality. Rather, it is crucial to search for an effective means to cope with it. At this late stage, to stress denuclearizing North Korea as the precondition for talks only destroys any chance to talk and pushes Pyongyang farther along its nuclear path. Regretfully, one has to face the North?s nuclear reality by asking it to cap, freeze and eventually cut its nuclear wherewithal, which takes a long time. Meantime, the U.S. can seek a normal relationship, as it has enjoyed with Tel Aviv, New Delhi and Islamabad.

China is interested in working with America to assure Pyongyang?s legitimate security while persuading North Korea to come down from the nuclear ladder. The upcoming summit meeting holds promise for a ?new type of great power relationship.?

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