Opinion | Forget decoupling. The US and China are better together
- The businesses, livelihoods and people that make up the deep and strong bilateral relationship will only be hurt by decoupling. That bilateral trade grew despite US-China tensions is proof of the ties that bind
From the economy to geopolitics, from technology to ideology, the US-China conflict, which recalls US-Soviet tensions, is being labelled by many as the beginning of a new cold war.
With calls for decoupling gaining vogue, armchair strategists are drawing up policies with seemingly little idea of how the US-China relationship was built up and how it functions. A closer look reveals why the relationship should not be rashly cut off. It is neither weak nor useless. Bound up with the lives of many individuals, the relationship is not something for politicians to play with.
Trump’s goal, as he put it, is to make America a “manufacturing superpower” and “end our reliance on China once and for all”. To show his resolution, Trump also threatened to impose tariffs on US companies “that desert America to create jobs in China”.
But terminating economic ties with China is not as easy as it sounds. Relocation costs is but one aspect and interfering with global supply chains could end up overhauling market structures and leaving local consumers and producers to pay the price.
Indeed, along both sides of the US-China relationship rest the livelihoods of many. Former speaker of the US House of Representatives Tip O’Neil said that “all politics is local”; for those who operate between the US and China, all business is local too. When politicians talk about trade and investment in numbers that run to billions, it is easy to ignore the real-life impact behind them.