President Biden told reporters this week his call with President Xi Jinping lasted two hours. Biden said it was a “good conversation” between two leaders who know each other well. The two leaders exchanged views on world health, climate change and weapons proliferation.
The US President touched on the sensitive areas of the crackdown in Hong Kong, the suppression in Xinjiang province and the aggressive moves on Taiwan.
President Xi made it clear, such issues were "internal affairs". Matters in which, the US should not seek to interfere.
President XI advised cooperation as the only correct choice for the two nations. Confrontation between the two nations would be a disaster. The key is "mutual respect, equal treatment and the handling of issues in dispute in a constructive and positive manner."
Biden seemed impressed by China's advances in transportation, particularly in the areas of high speed rail and electric vehicles. The US has a lot of catching up to do.
China's high-speed railway network is the largest in the world. The network reached 36,000 km (22,000 miles) in total in 2020, with plans to reach 70,000 km (43,000 miles) by 2035.
In the US, Amtrak's Acela Express, is the US only high speed rail service. The entire route from Boston to Washington, covers less than 500 miles and takes over six hours to navigate.
The President made the call, for Uncle Sam to step up, to compete effectively in areas of new technology. The administration promises to jump-start the clean-energy sector. It faces an uphill climb. The United States has fallen behind Asia and Europe, in the race to produce the high-tech batteries, powering electric cars and storing solar and wind energy.
China dominates battery production today, with 93 "gigafactories" manufacturing lithium-ion battery cells. There are just four in the United States, according to Benchmark Mineral Intelligence. If current trends continue, China is projected to have 140 gigafactories by 2030, Europe will have 17 and the United States, just 10.
China now leads the world as the leading destination for Foreign Direct Investment. Soon it will lead the world in Artifiicial Intelligence. China now has one billion internet users and claims an 80% share of world users of 5G. The largest learning networks lead the AI race.
In digital currency, China's plans are well advanced. Beijing will hand out $1.5 million in a further trial of the central bank's digital currency during the lunar holiday weekend. The total of 10 million yuan will be distributed through 50,000 parcels of 200 yuan. This marks the third major test of the digital currency under development, by the People's Bank of China.
China is set to overtake the US as largest economy in the world by 2028. Shares of world trade have been boosted on the back of the virus recovery. The potential remains huge. By the end of the decade, China will still struggle to enter the top 50 countries in the world, in terms of GDP per capita.
The priorities for the Biden administration will be to rebuild the industrial base, develop an edge in innovation and accelerate investment in semi conductors, artificial intelligence, biotech and clean energy. A review of the tariff policies both with China and with Europe is set to follow.
"We looked at what the Trump administration did over the last four years and found merit in the basic proposition of an intense strategic competition with China. But we found deep problems with the way in which the Trump administration went about that competition."
"'The approach, depleted the core of American strengths, putting the US in a weak position to carry out that competition. Overreach on technology restrictions, inhibits the development of US business and could push other countries toward China."
A more positive decision on TikTok is expected as the Biden administration determines its own response to risks. The Biden administration's review is being led by officials who have been critical of Mr. Trump's targeting of Chinese tech companies.
It is said, Biden's strategy will be driven by an awareness ..."The lions share of the history of the 21st century will be written in the Asia Pacific region", most of which will be outlined on the Chinese mainland.
Confrontation would be a disaster. Cooperation would be a move in the right direction. Co-opetition would be the way forward, especially in areas of new technology and infrastructure.
President Biden may have made the call but President Xi reversed the charges. It should be a wake up call for Uncle Sam ...
The Saturday Economist
John Ashcroft publishes the Saturday Economist. Join the mailing list for updates on the UK and World Economy.
|The Saturday Economist|
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