- Governments’ directions – whether the US tilts toward isolationism or internationalism, and if China remains authoritarian or liberalises – are seen as key
- The protest crisis was also discussed, with a panellist pointing out that Hongkongers have deep frustrations that have not been addressed
The outcome of the blistering US-China trade war is the most immediate of several variables poised to fundamentally shape the US-China relationship over the next decade and deeply influence the rest of the world, analysts at a conference on US-China relations said on Tuesday in New York.
The panellists expressed hope that the two superpowers could dial back their distrust and suspicion moving ahead but added that they weren't expecting much immediate progress.
"Now more than ever, it's very important for China and the United States " as superpowers, really, in the world economically " to tamp down the kind of craziness that's going on," said Alice Young, founder of an advisory group bearing her name.
"And I'm not sure that, right now, we're going to be capable of that," she added, speaking at "China Conference USA: Competition or Cooperation?", sponsored by the South China Morning Post.
Among the key variables expected to shape the future are whether China's economic growth rate remains at six per cent to seven per cent annually over for the next decade, or if it slips.
"If it's growing by three per cent at the end of the decade, that's a different variable," said Kurt Tong, partner with the Asia Group consultancy and former US consul general to Hong Kong and Macau.
Another important factor will be whether the US tilts toward isolationism or internationalism, he added. And a third is what direction Chinese governance takes " and in particular whether it remains in its current authoritarian mode or tacks toward greater liberalisation.
"That pendulum in recent Chinese history has been up and down," Tong said.
Ex-US envoy: 'threshold should be high' to change Hong Kong's special status
Tong said the main point that many often miss in the protest crisis is that the people of Hong Kong have deep frustrations that have not been addressed and need to be for some semblance of calm to be restored.
"Both the US and the mainland have a way of injecting their own views on Hong Kong," said Tong, who was based in the territory until June, shortly before the protests began.
"The West kind of sees it as China clamping down on Hong Kong, and some of that's true and some of that's not quite right. And China sees it as the West trying to take away a hard-earned piece of China's sovereignty, which is also not true."
Hong Kong has been hugely successful in large part because of its industrious and talented residents, he added.
"If everyone could just focus on what the Hong Kong people are aspiring to and figure out a way to address that, so their anxiety level goes down, then we could see that Hong Kong's success could continue for decades to come," Tong said.
Turning to the US-China trade agreement, panellists said they did not expect the Trump administration to follow through on its threat to apply another 15 per cent in tariffs to an additional US$156 billion in Chinese imports, an increase scheduled to take effect on Sunday.
Given the current environment " with the administration in the middle of an impeachment fight, the holidays approaching and an election year coming up " neither side has much appetite for deepening the impasse, Young said.
Technology will remain a key area of division between the two giants, panellists said, with some meeting of the minds possible on intellectual property rights, where China's self-interest aligns broadly with Western demands. That is considered a more likely area for compromise than the issue of forced technology transfer, since Beijing does not even acknowledge that it applies such pressure on foreign companies.
US-China rivalry will hurt 5G roll-out and innovation, experts say
In the end, reduced cooperation in the fast-growing technology ecosystem is likely to dent innovation, hurt both countries and undercut the global economy.
"In the old days, we'd say, if the United States sneezed, Japan would catch a cold. I think now, if China and the US sneeze, the world catches pneumonia," said Young, adding: "Both countries are going to lose out."
Wang Xiangwei, columnist and former Post editor-in-chief, added that China's was not out to challenge Washington directly but to ensure that its regional influence is commensurate with its rising economic power.
"Of course China has its own strategic purpose, everyone does," he said. "But I don't think China has that intention at all to take on the US. China just wants to show the world it has its own sphere of influence."
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