April 24, 2024

During a meeting in Beijing on Friday, Chinese leader Xi Jinping smiled at Bill Gates and praised Mr Gates as his “first American friend” he met this year.

Meetings in Beijing between Secretary of State Antony J. Blinken and his Chinese counterparts are likely to come across as distinctly cold beginning Sunday.

The high-level meeting is aimed at getting U.S.-China relations back on track, and many U.S. business leaders have been pushing the Biden administration’s efforts to restore stability to one of the world’s most important bilateral ties.

But for business leaders and officials from both sides, expectations appeared modest for the talks, which have two main objectives. One is to restore communication between the two governments, which broke down this year after Mr. Blinken canceled a visit scheduled for February after a Chinese surveillance balloon flew into U.S. airspace. The other is to prevent further deterioration of relations between the two countries.

There is already evidence of the impact of relationship breakdown.China’s foreign direct investment fell to 18-year lowA 2023 survey by the American Chamber of Commerce in China shows that companies still view the Chinese market as a top priority, but their willingness to invest has declined.

“Economic relations have become so frustrating that any sign of progress is welcome, although expectations for any sort of breakthrough are low,” said Jack Colvin, chairman of the state’s foreign trade council, which represents multinationals.

“Hopefully high-level conversations like this can start to inject some certainty into businesses in what is an increasingly fraught and unpredictable trade relationship,” he said.

Still, China holds strong appeal as one of the world’s largest consumer markets and home to many factories that supply global companies.This year, as travel restrictions eased after three years of pandemic lockdown, a slew of CEOs traveled to China, including Mary Barra of General Motors, JP Morgan’s Jamie Dimon and Stephen Schwarzman of The Blackstone Group.

During a visit to China this month, Tesla CEO and Twitter owner Elon Musk described the U.S. and Chinese economies as “siamese twins” and said he opposed efforts to split them. Apple CEO Tim Cook visited China in March, commend The “symbiotic” relationship between the company and the state.

Sam Altman, leader of OpenAI, which makes the ChatGPT chatbot, almost appeared At a conference in Beijing this month, he said U.S. and Chinese researchers should continue to work together to address the risks of artificial intelligence.

The tech industry, which has built lucrative relationships with Chinese manufacturers and consumers, has been wary of Washington’s tough approach to China. While industry groups acknowledge the importance of taking action to preserve national security, they are urging the Biden administration to fine-tune its actions.

Wendy Cutler, a former diplomat and trade negotiator who is now vice president of the Asia Society Policy Institute, said the United States and China will likely announce some small steps forward at the conclusion of the meeting. Governments may agree to increase the paltry number of flights between their countries or the visas they issue to foreign tourists, she said.

But Ms Cutler said there would be plenty of grievances on both sides. Chinese officials are likely to complain about U.S. tariffs on Chinese-made goods and restrictions on sales of coveted chip technology to China by U.S. companies. U.S. officials are likely to highlight China’s deteriorating business environment and its recent move to ban companies that handle critical information from buying microchips made by U.S.-based Micron.

“I don’t expect any breakthrough, especially on the economic front,” Ms. Cutler said, adding that “neither side wants to smile.”

U.S. officials hope Mr. Blinken’s visit will pave the way for more cooperation, including on issues such as climate change and restructuring the debt burdens of developing countries. Other officials, including Treasury Secretary Janet Yellen, are considering visiting China this year, and Xi and President Biden could meet directly at the Group of 20 meeting in Delhi on September 11 or at the Asia-Pacific Economic Conference in San Francisco. moon.

In recent months, Biden officials have tried to bridge the rift between the two countries by advocating for a more “constructive” relationship.They, like European officials, said their wish was “De-Risk and Diversify” Their economic relationship with China, not “decoupling”.

But trust between the two governments has eroded, and Chinese officials appear skeptical about the extent to which a Biden administration can restore relations.

Broad restrictions on semiconductor technology that can be shared with China, issued by the United States in October, continue to anger officials in Beijing. The U.S. has placed dozens of Chinese companies on sanctions lists for assisting China’s military and surveillance state, or circumventing U.S. restrictions on trade with Iran and Russia.

Biden administration officials are weighing further restrictions on China, including a long-delayed order covering certain U.S. venture capital investments. The White House is under intense pressure from Congress to do more to combat national security threats from Beijing.

Not all companies are pushing to improve relationships. Some with less exposure to China seek to reap political benefits from Washington’s growing rivalry with China. Meta, the parent company of Facebook and Instagram, has repeatedly raised concerns about TikTok, the Chinese-owned video app that has proven to be a formidable competitor to Instagram.

“This is really a debate about degrees,” said James Lewis, senior vice president at the Center for Strategic and International Studies. “How easy-going are you? How confrontational are you?”

Mr Lewis said the degree to which companies are resisting tensions with China is linked to their exposure to the Chinese market.

“I think a lot of it has to do with your presence in China,” he said.

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