[OVERSEAS VIEW]Missed opportunities made summit a failure

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[OVERSEAS VIEW]Missed opportunities made summit a failure

Hu Jintao has come and gone. His visit had little discernible effect on Sino-US relations. Of course, the value of such summits can be overrated. Logistics often overwhelm substance. But, if thoughtfully orchestrated, summit meetings can generate an atmosphere of good will, foster cooperation on issues of importance, and provide an action-forcing deadline for officials seeking to wrap up agreements. In this case, the atmospherics ― in Washington, D.C., though not in Washington State ― were poor, the substantive achievements elusive.
Much of the press focused on White House miscues during the welcoming ceremonies on the South Lawn. These were probably attributable to extraordinary carelessness rather than mischievous intent, but persuading the Chinese of that is a hard sell. A more serious error was in denying the Chinese their request for a state visit. Few Americans know the difference between a “state” visit, an “official” visit, or a “working” visit. State visits involve more pomp, but impose only modest additional demands on the president’s time. Its refusal gained little political credit from White House critics, yet forfeited a chance to bank some political capital with the leader of a major emerging power.
More lamentable was the lack of headway on substantive matters. The headlines following the visit declared, “Hu and Bush Agree to Disagree.” Yet the bilateral agenda is chock-full of significant issues on which American and Chinese interests broadly converge. On trade, non-proliferation and energy, for example, Washington and Beijing desperately need each other’s help.
The bilateral trade imbalance is skyrocketing. China does occasionally succumb to mercantilist reflexes. It does need to beef up its intellectual property protection. Its rate of currency adjustment has been timid. But the discussion of Sino-U.S. trade issues in Congress has deteriorated into a mishmash of pettifoggery and demagoguery. Proposals such as the one put forward by Senators Schumer and Graham to crack down on China’s currency manipulation are silly in concept and would be counterproductive.
Our bilateral trade problems stem from reciprocal imbalances. China saves much more than it consumes; Americans consume far more than we save. Neither side can expect the other to disproportionately shoulder the burdens of adjustment. A collaborative approach is necessary. The media coverage attracted by the summit offered the president ― who has admirable free trade instincts ― a timely opportunity and a bully pulpit for some straight talk with Congress and the public. It would have been helpful to inform them that our growing deficit with China results mainly from the relocation of production facilities into the PRC from Japan, South Korea, Taiwan and other Asian countries. Chinese exports are mainly supplanting jobs in Asia, not the United States. Americans get huge benefits from Chinese imports, which keep our consumer prices and manufacturing costs low. And we arguably get the best of the deal. China, after all, sends real resources to us; we pay for them with IOUs that depreciate in value. Yet the summit injected no momentum into the multilateral trade talks.
On non-proliferation, it appears that Presidents Bush and Hu rehashed familiar complaints. The Chinese admonished Washington to display greater flexibility in dealing with Tehran and Pyongyang. Mr. Bush urged Beijing to exhibit greater firmness toward both. Each has heard the other’s laments before. The impasse is becoming more dangerous. Negotiations with Iran and North Korea ― the world’s most dangerous proliferators ― are stalled; each is becoming more defiant, yet Sino-American exchanges on the issue appear to have become sterile and routine ― a virtual dialogue of the deaf. This is a great pity. Washington and Beijing, along with Japan and Russia, have the most to lose from a “nuclear breakout” in Northeast Asia, and they possess the capacity to counter it if they act in concert. The summit did little to facilitate a coordinated approach.
Nor were any breakthroughs evident on the energy front. The U.S. and China are the world’s two largest oil importers. We consequently share interests in expanding oil production, avoiding disruption of supplies, promoting efficiency and conservation, imposing some discipline on prices, fostering the development of alternative fuels, protecting the environment and safeguarding transport routes.
One deficiency of concern to both countries is the absence of a global institution to harmonize policy among the main energy-consuming countries. The International Energy Agency excludes non-OECD members. That means China and India, who are generating gigantic new sources of demand for oil, are absent from the table. If the summit addressed this question, it did not make it into the newspapers.
Disappointing summit meetings are a dime-a-dozen. Sino-American relations will survive. But a chance to improve the atmosphere, bank some political capital for an uncertain future and firm up the quality of our bilateral collaboration on interests we share was missed. And that’s a shame.

* The writer, a former U.S. ambassador to Japan, is a professor at Stanford University.

by Michael H. Armacost
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