China’s Grudging Welcome to Blinken: It’s All about the Economy

By Lily Kuo / The Washington Post

15:45 JST, June 17, 2023

Anticipation in Beijing about Secretary of State Antony Blinken’s imminent arrival has been, at best, lackluster.

After months of diplomatic freeze following the discovery of a high-altitude Chinese balloon floating over the United States – which derailed Blinken’s original trip to Beijing in February – Chinese and U.S. officials face a yawning gap between the two sides’ interests and positions.

One trip is unlikely to do much to change that.

“In reality, the Chinese side doesn’t harbor hope that Blinken’s visit will result in any meaningful results. You could say China has no hope for this meeting,” said Wang Yong, director of the Center for International Political Economy at Peking University.

Blinken, he said, “probably won’t be very welcome.”

In a phone call with Blinken on Wednesday, Chinese Foreign Minister Qin Gang said it was “clear where the responsibility lies” when it comes to the challenges the U.S.-China relationship faces.

Behind China’s frosty reception is a new sense of confidence. For months, China has hosted world leaders – including U.S. partners like French President Emmanuel Macron and European Commission President Ursula von der Leyen – and successfully mediated conflicts like the Saudi-Iran rift.

Beijing has offered to do the same in the Ukraine crisis, casting itself as a peacemaker and foil to the United States. Last month, its special representative for Eurasian affairs, Li Hui, traveled to Ukraine and Russia to pitch China’s proposal for ending the conflict.

This week, Xi hosted Palestinian Authority President Mahmoud Abbas in Beijing, where the Chinese offered a three-point plan to resolve the Israeli-Palestinian conflict. Honduras, after breaking off relations with Taiwan to recognize China in March, opened an embassy in Beijing on Sunday.

“China has made diplomatic progress and under these circumstances may feel that now these are the right conditions to deal with the United States,” said Zhao Minghao, professor at the Institute of International Studies at Fudan University in Shanghai.

Even as Beijing tries to establish a separate world order that is not dominated by the United States, China still needs – and wants – American investment and trade.

China faces sluggish growth, a property slowdown, record levels of youth unemployment and shrinking foreign investment. China’s central bank this week cut key interest rates and new economic data showed its post-pandemic recovery has lost momentum.

That’s a key part of why Chinese officials have been courting executives such as Bill Gates, who met Xi on Friday.

Xi told Gates during their meeting that the Microsoft co-founder was the first “U.S. friend” he had met in Beijing this year, according to Chinese state media. Xi reportedly added that the future of China-U. S. relations lies with the people.

JPMorgan CEO Jamie Dimon, Starbucks CEO Laxman Narasimhan and Tesla and Twitter CEO Elon Musk all traveled to Beijing last month to shore up their business interests.

“China hopes the relationship between China and the United States can be improved in part to help its economic recovery and other economic challenges,” said Zhao of Fudan University.

But separating politics and business is difficult. Last week, Sequoia Capital, an early investor in TikTok’s parent ByteDance, said it would split its China and U.S. operations into separate companies. The ubiquitous video platform faces various restrictions and bans in the United States on national security grounds.

At the same time, Chinese officials are sending mixed messages. Raids on due-diligence firms operating in China such as Mintz Group and Bain & Company have made other foreign companies nervous. A recent overhaul of the country’s espionage law has foreign executives worried that normal business operations could be deemed illegal.

For its part, the Biden administration has not made the environment easier. On Monday, it blacklisted more than 30 Chinese companies for selling U.S. technology to the Chinese military and is expected to set new limits on U.S. investments in China. Washington has already prohibited the sale of advanced U.S. semiconductors to China.

“Easing ties with the U.S. will help the government’s goal of ‘stable foreign trade, stable foreign investment,'” Zhao said, quoting a government campaign that has gained urgency as Chinese officials insist the country is open again for business.

This is one of the reasons Chinese officials, while giving defense and political officials the cold shoulder, have been meeting with U.S. trade and commerce officials. Chinese Commerce Minister Wang Wentao met Commerce Secretary Gina Raimondo and Trade Representative Katherine Tai in the U.S. last month.

“Beijing agreed to the visit because it seems to be the one thing that is blocking many other things, such as working level dialogues and the visits by other cabinet members,” said Yun Sun, the director of the China program at the Washington-based Stimson Center.

“It is also important for China not to appear to be the one rejecting dialogue, especially when the U.S. has been pushing for it,” she said.

For China, the trip paves the way for other visits by U.S. officials like special climate envoy John F. Kerry or Treasury Secretary Janet L. Yellen, whose remarks that decoupling from China would be a mistake have won her fans in China.

“I think we gain and China gains from trade and investment that is as open as possible and it would be disastrous for us to attempt to decouple from China,” Yellen told a House Financial Services Committee hearing on Tuesday.

Chinese officials are also looking ahead to Xi’s potential appearance at the Asia-Pacific Economic Cooperation (APEC) meeting in San Francisco in November, where he could meet with Biden. Their last meeting in November on the sidelines of the Group of 20 Summit in Bali helped ease tensions.

“If there’s hope of any concrete results from this visit, it may be a signal that China’s leader will visit the U.S. to attend APEC,” said Wang, the Peking University professor. For that to happen, Blinken’s visit would need to create “more positive conditions,” he said.

Chinese officials have not given any details of Blinken’s visit. According to the State Department, Blinken will meet senior Chinese officials Sunday and Monday, including Foreign Minister Qin. After meeting Gates on Friday, it would be a notable snub if Xi didn’t see Blinken.

“Given the current levels of mistrust and tension in the relationship, a good outcome would be a better understanding of each side’s concerns and red lines as well as modest progress on areas of overlapping interest,” said Jessica Chen Weiss, a professor at Cornell University focusing on U.S.-China relations.

China also has areas where it could compromise and collaborate, according to Wang of Peking University. These include climate change, public health and counternarcotics efforts.

Yet one critical sticking point for Beijing is continued U.S. support for Taiwan, which China worries is increasing and undermining U.S. adherence to the “One China” policy. That policy recognizes the People’s Republic of China as the sole legal government of China but stops short of accepting Beijing’s claims over Taiwan.

“China has no illusion about the U.S. changing its stance on Taiwan,” said Lau Siu-kai, an emeritus professor of sociology at the Chinese University of Hong Kong.

“Without any possibility of bridging the gap between the two sides on these issues, any rapprochement is impossible.”