Wednesday, 9 November 2016

In Trump Win, China Hopes for U.S. Retreat


Election results mean economic threat, geopolitical opportunity for Beijing
SHANGHAI—The gray, conservative men who run China have no love for Hillary Clinton, but at least she was a known entity. In an erratic Donald Trump they now face both an economic threat and geopolitical opportunity if, as seems likely, a distracted America pulls back from Asia.

Beijing may believe that Mr. Trump is bluffing when he threatens sweeping tariffs on Chinese imports; the official media have portrayed him as more of a clown than a menace.

But it had better brace for the consequences of a populist revolt that swept him to victory, fueled by anger at the perception among working-class whites that China has stolen American jobs. Mr. Trump’s ascendancy to the White House delivers the sharpest blow yet to the forces of globalization that propelled China’s rise. The world’s most consequential bilateral relationship now faces an extended period of uncertainty and tension.
The damage to U.S. democracy from an ugly election campaign—and now a polarized country—underscores the Communist Party’s propaganda message to the masses that it alone stands between order and chaos. While American politics are in convulsion, the Chinese leadership projects stability. Beijing wants a bigger say in how the world is run. Turmoil in Washington serves that purpose well.

Mr. Trump has promised to rip up America’s trade agreements; a video documentary by one of his chief advisers on China, the economist Peter Navarro, opened with a Chinese dagger plunging into America’s heart. In this view of the world, China is a villain, along with Mexico, responsible for emptying out U.S. manufacturing cities.


It doesn’t matter that manufacturing jobs are now fleeing China for lower-cost countries like Bangladesh and Vietnam, Mr. Trump has promised to bring them home.

If he carries out his threat to slap an across-the-board 45% tariff on Chinese imports, expect retaliation against American investors that will slice into the profits of companies doing well in China, including General Electric, Boeing and Apple.
Note, too, that trade has long held together the U.S.-China relationship that is fraying in so many other areas—from how to deal with the North Korean nuclear threat to China’s aggression in the South China Sea.


On the geopolitical front, Beijing has reason to cheer the election result: Mr. Trump has less regard than Mrs. Clinton for America’s military alliances, which have underpinned U.S. dominance in China’s neighborhood since World War II—a primacy that Beijing is determined to upend.

His election may well kill off Barack Obama’s signature foreign-policy initiative, the “pivot” to Asia, which Beijing views as military containment, an invitation to China to assert more control over what it calls its “near seas.” Mr. Trump rejects the Trans-Pacific Partnership, a massive free-trade deal at the heart of Mr. Obama’s plans for a greater U.S. regional engagement.

Yet it is the American security guarantee that has kept the peace in East Asia and allowed the world’s most dynamic region to focus on growth.

If U.S. allies like Japan and South Korea, who Mr. Trump portrays as free riders, start doubting U.S. defense commitments, a regional arms race could ramp up. China’s nightmare is a Japan that loses faith in the U.S. nuclear umbrella and decides to build its own weapons.

Already, right-wing politicians in South Korea are advocating an independent nuclear deterrent as Pyongyang accelerates its nuclear and missile testing.

Pax Americana—the U.S.-led global order—is already looking shaky in East Asia, precisely because countries worry about the staying power of country capable of producing this kind of political shock. China’s authoritarianism is at least predictable. Philippine President Rodrigo Duterte has canceled military exercises with the U.S. and is shopping for weapons in China, as is Malaysia’s leader, Najib Razak, who recently announced the purchase of at least four Chinese navy ships.

Mrs. Clinton’s blunt diplomatic style grated on Chinese leaders. As first lady, she berated them over human rights, and as secretary of state she irritated them again with her lectures on freedom of navigation in the South China Sea.

Mr. Trump has focused almost exclusively on trade in his hectoring comments on China. Still, he prides himself on his deal-making ability. China may hold out hope it can outwit him in negotiation—businessmen generally abandon their combativeness and turn meek when they come to Beijing—and that a commercial focus on both sides can produce pragmatic outcomes.

Expect China to watch Mr. Trump very carefully before reaching any conclusions about his intentions.

Beijing has learned to tune out the hostile rhetoric of U.S. presidential candidates. Bill Clinton railed against the “Butchers of Beijing,” a reference to the 1989 Tiananmen Square massacre, before taking office and ushering China into the World Trade Organization, which supercharged its growth. George W. Bush called China a “strategic competitor” before embracing the country as an ally in his war on terror.


In office, Mr. Trump will discover an enduring reality, as his predecessors did: No global problem can be solved without China’s help, and America can only prosper if China does. A trade war would produce only losers.

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