What made you kowtow, Mr Bush?

It is no wonder that Premier Wen Jiabao is so pleased with his visit to the United States. President George W. Bush's public admonishment of Chen Shui-bian's proposal to extend the scope of Taiwan democracy with a referendum was a major diplomatic victory. The question now is whether there will be a sequel. Has Beijing offered up something substantial in return? Or is this an illustration of a fundamental weakness of the US - Mr Bush can start patriotic wars in poor countries, but must he now kowtow to China? He did not have to go beyond well-worn but useful phrases about Taiwan. But he did. Why?

There will doubtless be much discussion about whether the US ambiguity over Taiwan has been altered by Mr Bush's statement. One can argue whether the Taiwan move for a referendum represents a departure from the status quo. But once cannot argue against the fact that Mr Wen is feeling triumphant and Mr Chen has been humiliated by the US.

It remains to be seen how the Taiwan public responds. My own guess is that although many in Taiwan feel his manoeuvring on the referendum issue has been ill-advised, Mr Chen could benefit from resentment at the hypocrisy of a US administration which preaches democracy but often practices the ruthless pursuit of sectional political or business interests. The business interests which have such an influence on the Bush administration have evidently been persuasive in the president's willingness to please Mr Wen at Taiwan's expense.

The question now is whether the US will get anything specific from China. There is talk of more pressure on North Korea. But China has been making efforts there for some time and its leverage over the prickly North Koreans is limited. It is possible that China has promised that it will do something sooner rather than later to respond to legitimate concerns about its undervalued currency. Revaluation would not significantly hurt if other Asian nations with even bigger surpluses do the same - which they almost certainly can be persuaded to do. Indeed, it is something of a puzzle why the US has been berating China over its currency policy but not doing the same with the other East Asian countries whose surpluses and exchange reserves are proportionately much bigger.

East Asian revaluations will not do much for the US trade deficit until America's debts, domestic and foreign, finally cause the deep recession needed to restore current-account equilibrium. However, they could be claimed as a victory in an election year when China trade could be an issue.

But maybe Mr Wen has offered nothing specific in return for Mr Bush's words on Taiwan. Perhaps, in the face of tensions with Europe, a Middle East quagmire and growing international cynicism about the 'war on terror', Washington is gradually returning to former president Bill Clinton's view of China. It may be going too far to regard it as a 'strategic partner' but it is no longer the strategic competitor, as defined by the Bush administration prior to September 11, 2001. If so, it may expect a friendly but neutral stance from China on a variety of issues in return for putting Mr Chen in his place.