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Opinion | The US-China trade war should prompt American firms to take a US Inc approach to doing business
- US companies should consider expanding supply chains and export markets outside China and moving critical manufacturing back to the US
- They have a role to play in protecting the national interest
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Chinese Vice-Premier Liu He’s losing the title of “special envoy” representing President Xi Jinping in the latest round of talks with US trade negotiators indicated that this round was never intended to reach a compromise, but instead constituted a high-level message that China was not willing to make the concessions demanded by the US.
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The two sides are now locked in a protracted conflict to protect their respective economies from what each perceives as the ravages of the other.
China’s mercantilist, develop-at-any-cost strategy for building its economy has, since the days of paramount leader Deng Xiaoping, been based on the premise that a developed and growing economy was necessary for the security of China and the Communist Party that governs it.
The United States, particularly since the end of the cold war, has been content to let market forces shape the world’s largest economy, which provided ample resources, including cheap debt, for national defence and security.
Frustrated by China’s years of broken promises to further open its markets, subsidies to state-owned enterprises and national champions, pervasive theft of intellectual property and forced transfer of technology, US President Donald Trump’s administration is taking a leaf out of China’s playbook and treating the economy and industry as a strategic asset that must be defended.
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