Ian Williams
For clues as to where US policy towards Beijing goes next, look beyond Donald Trump’s chaotic and erratic tariffs and focus instead on the small print of the US-UK draft trade deal. It has a clear message: that if you want to do business with Washington, keep China at bay.
The agreement itself doesn’t quite put it that way. It doesn’t need to. Instead, there are broad pledges to cooperate and coordinate on ‘the effective use of investment and security measures, export controls, and ICT [information and communications technology] vendor security’, and ‘to address non-market policies of third countries’ – all tailor-made for China, even if the country is not mentioned by name. It is even more significant because the UK agreement is being touted as a template for those the US is seeking to strike with others.
That explains why Beijing is so rattled, its foreign ministry telling the Financial Times it was a ‘basic principle’ that agreements between countries should not target other nations, and that ‘co-operation between states should not be conducted against or to the detriment of the interests of third parties’. Earlier, before the weekend tariff war truce between China and the US, China’s commerce ministry warned any country striking trade deals at its expense that it ‘will take countermeasures in a resolute and reciprocal manner’.
That is, of course, rank hypocrisy. Beijing routinely strong-arms countries and companies over trade, investment and market access. For instance, when Lithuania allowed Taiwan to open a diplomatic presence in Vilnius using its own name, Beijing launched a trade embargo against the Baltic state that also included threatening multinational companies that sourced their components from Lithuania. More recently, Beijing has urged Chinese companies to purge foreign-made goods from their own supply chains.
Beijing’s reaction to the US-UK deal is a measure of its concern that despite the 90-day suspension of crippling tariffs, Washington remains not only intent on shaking up international high-tech supply chains, locking China out from the most sensitive areas, but is seeking to bring allies and trading partners into line via trade deals.
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