China-US relations: Joe Biden’s Asia-Pacific trade framework to be handled with ‘caution’, Beijing advisers say

22/06/2022    32

China should take an objective and cautious attitude towards US President Joe Biden’s Indo-Pacific Economic Framework (IPEF), top-ranking former Chinese officials have said.

The IPEF, which is not a traditional free-trade agreement but seeks to establish rules covering areas from data protection to carbon emissions, was launched in Tokyo last month.

The US has said 13 Asia-Pacific nations, accounting for 40 per cent of the world’s gross domestic product, had joined – though crucially not China.

“Despite the bumpy China-US relationship and Biden’s new IPEF initiative hoping to exclude China from mainstream Indo-Pacific collaborations, we shouldn’t be too harsh and critical towards [it],” said Long Yongtu, China’s former vice-commerce minister at a forum organised by the Centre for China and Globalisation.

Many members of the trade agreement – including Australia, Brunei, Japan, New Zealand, Thailand, Singapore and Vietnam – are signatories to the Regional Comprehensive Economic Partnership (RCEP), which includes China, and are “important partners”, said Long at the event on Sunday.

“The cautious attitude we take towards this framework includes considerations not only from the standpoint of the United States, but also the situation among other founding members. We should make them feel at ease.”

Through the IPEF, Washington hopes it can restore influence in the region, after former US president Donald Trump withdrew from the Trans-Pacific Partnership (TPP) free-trade agreement in 2017.

Yu Hongjun, a consultant at the Centre for China and Globalisation and former deputy minister of the Communist Party’s International Department, agreed that China should not publicly condemn the IPEF, but be calm and objective while dealing with it.

“When dealing with multilateral issues, [China] must consider the feelings of neighbouring countries,” Yu said.

“Most Asean countries have taken part in this arrangement. When dealing with issues of neighbouring regions, we should consider both our own concerns and our neighbours’ concerns, and organically coordinate our long-term benefits with the long-term benefits of the external world.”

Experts said studying the IPEF will help China take part in regional economic development, especially involving the US.

Noting the impact geopolitics has had on globalisation in recent years, Chen Xiaogong – another consultant at the Centre for China and Globalisation and former deputy director of China’s Foreign Affairs Office – said companies are now focused on supply chain security and flexibility over efficiency and profit.

“We should focus more on industrial chain issues in our diplomatic policies,” Chen said. “Especially at a time when the West is excluding China, we should attach great importance to the IPEF standards about digital economy and supply chain flexibility.”

Liu Shijin, former deputy director of the Development Research Centre under China’s State Council, said globalisation and the unpredictable US-China relationship posed questions for Beijing. Namely, how deeply integrated China wants to be in the global division of labour, or whether domestic development is sufficient.

The country must also decide whether it wants to build a high-standard capitalist market, he said.

China submitted a formal application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which emerged after Trump withdrew the US from the TPP, in September.

The deal came into force in December 2018 and includes Japan, New Zealand, Australia, Brunei, Canada, Chile, Malaysia, Mexico, Singapore, Peru and Vietnam.

“Regional organisations, such as CPTPP, have been raising the market economy standards, whether we want to try to be a part of it, and whether we can accept at least part of the agreement [are questions to be asked],” Liu said.

“The next problems China must solve to improve its market economy include the standing of state-backed firms, industrial policies, labour protection, environmental protection and rules for the digital economy, among others.”

Source: South China Morning Post