A phenomenon seen lately in the relationship between USA & China cannot escape attention of business strategists world over. All three branches, namely geopolitics, geoeconomics and geostrategy were in the play. Yet Chinese reaction shows none of these worked. On the contrary China hardened her stance. Let me explain:
Antony Blinken, US Secretary of State ushered in the scene one when he visited Beijing during June 18-19. “The Secretary emphasized the importance of maintaining open channels of communication across the full range of issues to reduce the risk of miscalculation.” So conveyed the read out of the State Department of his talk with the Chinese counterpart. But the protocol was breached as Chinese President was in the lead chair and both Chinese hosts and American delegation faced each other across the table. Result: China simply harkened down to the Secretary that geopolitics pressure is going nowhere.
In the previous month CIA Director secretly travelled to China and met with his counterpart for a discussion of mutual affairs. There were two reports. One source said “Director Burns travelled to Beijing where he met with Chinese counterparts and emphasized the importance of maintaining open lines of communication in intelligence channels”. Second source clarified it more blithely that the trip was “an intelligence to intelligence engagement, not a diplomatic mission”. Unmistakably it is clear that this was an attempt to bring geostrategic pressure on China to play along but Chinese failed to do that.
What remains manifestly is the third level of geoeconomics. There were two visits in almost quick succession. First one was by Janet Yellen Secretary of US Treasury that lasted four days in July 6 to 9. Euphemistically the purpose was stated to be “aimed at rebuilding bridges between the two countries along with managing ties responsibly”. Conceivably Janet was on a mercy mission to plead with China to slow down liquidation of US Treasury investments and maintain the current level of holdings of 850 US$ Billion intact. Her emphasis was de-risking and not decoupling. China failed to make out any promise over this matter, though.
Concomitant to this trip US commerce Secretary Gina Raimondo began her tour of China on Sunday 27 August with the same message this time de-coupling was not even mentioned and de-risking was emphasised little more. While security concern is paramount in her engagement she was toning down geopolitical and geostrategic aspects and instead went for geoeconomics because stabilizing US- China trade currently around US$ 7000 Billion need to be improved as it funnels China surplus towards investments in treasury bonds.
Furthermore travel & tourism was selected as an ideal balancing item; as of late Chinese travellers are dumping plans for their tour in US cities. Cursory glance over the export curbs imposed on rare earth minerals for US chip manufacture was made without upsetting the Chinese officials. Overall the tone is friendlier and no threatening language was used.
The bottom line is America has fewer options than before to browbeat China into submission. America cannot go for paradigm change in her approach vis a vis China. Curiously enough, the Chinese officials showed little more courtesy to Gina Raimondo than the three other biggies who visited earlier. Simply said, all three pressure techniques in geopolitics, geoeconomics and geostrategy have hopelessly failed!
Cheers!
Muthu Ashraff Rajulu
Business Strategist
Mobile: + 94 777 265677
E-mail: cosmicgems@gmail.com
Blog: Business Strategist
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