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China is optimistic it can work with the experienced economic team appointed by U.S. President Joe Biden towards normalising bilateral relations, a high-ranking advisor to the State Council told MNI, urging the two countries to establish informal channels of communication.
In an interview, Zhu Guangyao, a former Vice Minister of Finance, acknowledged normalisation will take time, despite the deep understanding and practical experience that Treasury Secretary Janet Yellen and her team have in China-U.S. economic relations, and said he expects them to play a constructive role in restarting dialogue.
Zhu, who was vice finance minister between 2010 and 2018 and has worked with prominent members in Biden's circle, including deputy treasury secretary nominee Wally Adeyemo, said the current economics team has "stability, predictability and professionalism."
Still, Biden may have domestic considerations and the negative legacy of the Trump administration to deal with, he said.
One challenge will be if the U.S. unites with its allies to pressure Beijing. "That would be a retreat from the G20 framework" and won't resolve the global economic challenges, Zhu said.
Although issues like alleged human rights violations by China may dominate headlines, Zhu said he believes the Biden team knows it is in the interests of the U.S. and the world to work with China. With China maintaining growth last year while the U.S. contracted, its economy has reached 70% of the size of the U.S. and it plans to further double by 2035, Zhu said. However, he also said China's per-capita GDP is much less than the US.
In a recent phone call with China's top diplomat Yang Jiechi, Secretary of State Anthony Blinken criticized China while Yang also spelt out China's stance on key issues. "They each spoke their own language, but this is the start of a process," Zhu said.
Referring to Biden's decision to review all China policies before any action and the phrase used by Press Secretary Jen Psaki in reference to China relations, Zhu said, "We have more strategic patience than the U.S."
He identified the global economy and strategic security as priorities for dialogue and climate change and addressing developmental inequality as common areas of interest.
He suggested China and the U.S. establish unofficial contacts as these are sometimes more effective than formal ones. Working-level engagements will facilitate an eventual meeting between the two presidents, he said, urging private negotiations to cancel punitive tariffs on each other's products.
The U.S.' return to multilateralism aligns it with its allies, including the EU, who have made it clear that they intend to stick with free trade, Zhu said. Nevertheless, China will honour the Phase One trade deal and wishes both sides to lift additional tariff, he said. He also urged the U.S. to revisit the Bilateral Investment Treaty that was abandoned after years of negotiations in 2016.
"The issue of the digital economy, digital data flows were big obstacles at one time among several others, but international cooperation over regulating the new economy is more urgent than before," Zhu said.
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