Business World

Monday 21 October 2019

Michael Schuman: 'Trump must learn he can't win a trade war and culture clash with the Chinese'


Street scene: A woman and her child ride an electric tricycle in the old town of Luoyang in Henan province, China. Photo: REUTERS
Street scene: A woman and her child ride an electric tricycle in the old town of Luoyang in Henan province, China. Photo: REUTERS

Michael Schuman

Throughout its 500-year relationship with the West, Beijing has sought to profit from its wealth without truly embracing its ideals and norms. That long-standing ambivalence is playing out in trade negotiations today and probably doomed them before they even got under way.

The notion China can be turned "Western" has been the mainstay of US foreign policy toward Beijing since President Richard Nixon held his famous 1972 meeting with Mao Zedong. But the thinking goes back much further.

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In the 18th century, the European powers, frustrated by Chinese trade practises, wanted the Qing Dynasty to adopt its economic principles, too. Back then, China was more than happy to trade porcelain and tea for silver, but the court tightly controlled such exchanges.

That seemed unfair to merchants who desired free trade. In 1793, the British sent a mission led by Lord Macartney to Beijing to plead for market opening and other reforms.

But Macartney's refusal to perform the standard, obsequious kowtow before the emperor enraged protocol-obsessed mandarins. The emperor sent Britain's King George III a condescending letter rejecting the requests.

"How can our dynasty alter its whole procedure and system of etiquette, established for more than a century, in order to meet your individual views?" he asked.

The Qing never willingly accepted Western-style trade and diplomatic practises. They were bombarded into it - literally, by the cannon fire of the Opium Wars in the mid-19th century. Only then did China open wider to foreign commerce and culture, and begin to accept European-style state-to-state relations.

Resistance, though, hasn't been China's only response. Beginning in the late 19th century, Chinese intellectuals, reformers and revolutionaries came to believe the country had to become more like nations such as Britain and the United States.

As the Qing Dynasty tottered, these thinkers saw salvation in copying overseas institutions and practises - such as a constitution, elected assemblies and Western-style schools.

Still, debate raged over how westernised China had to become. Some argued merely buying Western guns and learning its new technology would be sufficient; China's core institutions didn't have to change. Others saw China's traditions as outdated and backward. Only wholesale adoption of foreign ideas could rebuild its greatness.

It's ironic the trade talks fell apart near the 100th anniversary of the May 4 Movement. Named after student protests in 1919, the term signifies a wider campaign to change society.

"I would much rather see the past culture of our nation disappear than see our race die out now because of its unfitness for living in the modern world," Chen Duxiu, a founder of the Chinese Communist Party, wrote.

This spirit carried into the 1980s. Under China's pro-market reforms, the country adopted free enterprise, invited in overseas investment, heeded Western economists and joined institutions such as the World Trade Organisation. No less a figure than Hu Yaobang, the party's general secretary, suggested Chinese should eat with knives and forks rather than chopsticks.

But wariness of the West never went away, and as China's economic might has grown, so has its determination to chart its own course.

On the global stage, President Xi Jinping has pushed Chinese alternatives to the Western world system, such as his Belt and Road infrastructure-building programme. At home, Xi has emphasised the role of the state over greater liberalisation and promoted traditional Chinese culture and philosophy to ward off unwanted ideas such as democracy.

This love-hate attitude is playing out in the trade talks. On the one hand, Beijing realises it benefits from being part of the current US-led global order. On the other, Beijing isn't willing to embrace that order fully and accept its norms.

The Trump administration faces the same frustrations as 18th-century traders. With his tariffs and threats, Trump is effectively saying: "OK, China, if you won't follow our rules on your own, we'll just have to force you." It may appear unfair China won't reciprocate the openness that many in the West hold so dear. Arguably, the Chinese economy would be better off if it did.

That doesn't mean China will. Trump's attempt to force its hand will fail, no matter how high he raises tariffs. Washington has to learn to deal with the China it has, rather than the China it would like to see.

Michael Schuman, who is based in Beijing, is the author of 'The Miracle: The Epic Story of Asia's Quest for Wealth' and 'Confucius and the World He Created'

Irish Independent

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