Trump China Trade War Has Deeper Agenda

By F William Engdahl and cross-posted from New Eastern Outlook

Washington’s recent trade actions are aimed foursquare at China, not at the EU or other trade partners. However, the aim is not to reduce China exports to the US. The aim is a fundamental opening up of the Chinese economy to the Washington free market liberal reforms that China has steadfastly resisted. In a sense, it is a new version of the Anglo-American Opium Wars of the 1840s using other means to open China. China’s vision of its economic sovereignty is at direct odds with that of Washington. Because of this Xi Jinping is not about to cave in and Trump’s latest threats of escalation risk a major destabilization of the precarious global financial system.

There exist basically two contradictory visions of the Chinese future economy and this is what the Washington attacks are about. One is to force China to open its economy on terms dictated by the West, especially by US multinationals. The second vision is one put in place during the first term of Xi Jinping aiming to transform China’s huge economy into the world’s leading technology nation over the coming seven years, a tall order but one Beijing takes deadly serious. It is also integral to the vision behind Xi Jinping’s Belt Road Initiative.

China 2030…

Washington is determined to push China to adhere to a document it produced in 2013 together with the World Bank during the time Robert Zoellick headed it. The document, China 2030, calls for China to complete radical market reforms. It states, “It is imperative that China … develop a market-based system with sound foundations…while a vigorous private sector plays the more important role of driving growth.” The report, cosigned then by the Chinese Finance Ministry and State Council, further declared that “China’s strategy toward the world will need to be governed by a few key principles: open markets, fairness and equity, mutually beneficial cooperation, global inclusiveness and sustainable development.”

Referring to the current Washington strategy of imposing import tariffs on billions worth of Chinese products, Michael Pillsbury, a neo-conservative former Trump Transition adviser and China expert told the South China Morning Post, “The endgame is that China complete its deep reforms of its economy as laid out in the joint report,” referring to the World Bank Zoellick China 2030 report.

…Versus Made in China: 2025

Notable about that report is that it was released at the very start of Xi Jinping’s presidency and can be said to be a product of an earlier China. Soon into office, Xi unveiled what is now his Belt Road Initiative, the ambitious multi-trillion industrial infrastructure project for high-speed rails and deep water ports that would create an integrated economic space across Eurasia including Russia, South Asia, the Middle East and parts of east Africa. Two years after Xi Jinping unveiled his new Economic Silk Road as it was initially called, his government released a quite different national economic strategy document to that of the World Bank. It is titled China 2025: Made in China…

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