Carnegie Endowment for International Peace
The EU-China Comprehensive Agreement on Investment was born in a complex political environment but now has renewed potential to warm economic relationships between the two powers. As U.S.-China tensions rise, the EU may have taken a different route into uncharted territory.
Several trends from China have converged in 2020, creating an international shockwave and rising to the top of foreign policy priorities.
U.S. President Joe Biden and his administration are breaking out onto Asia's diplomatic stage in a big way, beginning with the first-ever leaders' meeting of the "Quad" (the United States, Japan, Australia and India).
Given that competition is inevitable, the United States must maintain multipolarity in Asia, create constraints on Chinese action in the region, and work with likeminded allies and partners like Japan and India.
To succeed, the Quad needs to evolve from a China-focused club of four to a group of first movers on an array of specific functional challenges. The best way to do this is for the four countries to form the core of a rotating set of ad hoc problem-solving coalitions in the Indo-Pacific.
China’s 2020 trade surplus increased by a quarter over the previous year and foreign reserves have hit a near-five-year high. For the whole of 2020, GDP grew 2.3 per cent, much better than the 4 per cent to 10 per cent declines for the US and euro-zone economies.
China’s relationship with the West involves everything from nuclear weapons to climate change, and the stakes are high.
The 2021 Trade Policy Review comes out as a careful and guarded document, but it includes a push for realist and defense-based instruments alongside with “openness and engagement.”
All the complexities of trans-Pacific politics are being flattened into an escalating U.S.–China conflict. Just like polarization within a country marginalizes those who identify with neither pole, a polarized Pacific is one where the interests of even major players in Northeast and Southeast Asia get sidelined.
U.S. President Joe Biden has not yet indicated if he will reverse the Trump-era tariffs on China. In addition to the trade war, there are three key areas that may define Sino-U.S. ties under a Biden administration.