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AFTER a period fraught with contro- versial and sensitive issues, China’s Ministry of Commerce hosted on August 28, 2012 in Beijing the China-U.S. Economic and Trade Cooperation Forum.
The year 2012 is critical for both China and the United States. Presidential elections in the U.S. are gathering momentum. In contrast to those in the year 2008, China figures largely in both the Democratic and Republican campaigns. Both parties are going all out to garner support through vaunting their political stands on China-related issues – a tactic that has prompted loud disapproval from the Chinese public. An important political election is also imminent in China – that of the new central leadership at the 18th National Congress of the Communist Party of China. Recent discord and conflicts that have sprung up between China and the U.S. have triggered debates on exactly where China-U.S. relations are heading. As the world’s two biggest economies, their relationship has global impact. It was under this scenario that the China-U.S. Economic and Trade Cooperation Forum commenced. Its purpose to highlight the full significance of China- U.S. economic and trade cooperation, the forum included keynote speeches and debates with the aim of formulating appropriate ways of developing economic and trade cooperation.
At a time of widespread uncertainty about China-U.S. relations, the forum, themed “expanding common interests and building a community of common interests,” outlined an optimistic road to further development of this bilateral relationship.
There are generally three possible modes of country-to-country relationships: hot war, cold war, or cooperation. The last is clearly the only correct choice for humankind.
How, then, do we deal with contradictions and divergences? In my opinion, we should be cognizant of existing problems while attempting to pinpoint common interests and their potential convergence.
As China’s state leaders, notably Deng Xiaoping and Hu Jintao, have repeatedly pointed out, there are between China and the U.S. co-existent areas of both divergence and common interest, the latter greatly outweighing the former. When addressing bilateral relations, common interests are hence the main focus of Chinese leadership. Although the two countries’ respective interests are not always congruous, convergences nonetheless exist. Building a community of common interests based on such convergences will expand China-U.S. common interests to the point where they become interdependent. As neither side can afford to ignore or prejudice such expanded common interests, taking them into account will make both of them more rational and objective when dealing with differences, contradictions and divergences that arise.
This being the case, exactly what interest convergences do China and the U.S. share with regards to economic and trade cooperation?
Investment cooperation is foremost. At the time of writing, bilateral cooperation in this area has seen progress. The U.S. investment volume in China amounts to US $70 billion. China’s investment in the U.S., however, is less than US $10 billion. Notwithstanding this lopsided development, bilateral investment cooperation has huge potential. American economic growth is still sluggish owing to after-effects of the global economic crisis. Generating economic growth sufficient to create more jobs, therefore, is U.S. President Barack Obama’s only way of lifting the U.S. out of its current depression. China, on the other hand, has accumulated a sizable amount of wealth over 30 or more years of rapid development. The country’s enterprises have both the capacity to invest abroad and the incentive to set up overseas operations.
The United States is the world’s sole superpower, but there remains much room for improvement in its infrastructure. The American economy stands to benefit considerably were China and the U.S. to invest cooperatively in American infrastructure, by virtue of the jobs this would create. Such cooperation would also give China’s enterprises greater scope for development. A truly win-win situation could thus come about.
Another point of interest convergence is that of cooperation between the two countries’ small and medium-sized enterprises(SMEs). China’s private economy creates roughly 80 percent of its jobs, and private enterprises are mostly small and mediumsized. Firms of this size in the United States have also been instrumental in job creation. So far, there has been considerable cooperation between the two countries’ big corporations, but seldom between their medium-sized and small ones. Both have their respective advantages. SMEs in the U.S. usually possess advanced technologies and patents, but lack capital and markets. Although there is generally an absence of sophisticated technology in Chinese SMEs, they have ample capital fueled by China’s huge market. Pushing forward cooperation between the two sides’ SMEs would create a more solid bond in their bilateral economic and trade relations.
Finally, there exists considerable space for bilateral cooperation through tapping U.S. innovation ability and simultaneously promoting transformation of China’s economic growth mode. America is acknowledged throughout the world for its strong innovative ability, and technical innovation is the surest route to regenerating the world economy and dissipating the current depression. Transforming its economic growth mode from that of high pollution and high-energy costs to resource saving and environment-friendly will be a difficult process for China. Technical innovation, however, can facilitate this transformation. The scope for bilateral cooperation in science and technology, therefore, is immense.
The year 2012 is critical for both China and the United States. Presidential elections in the U.S. are gathering momentum. In contrast to those in the year 2008, China figures largely in both the Democratic and Republican campaigns. Both parties are going all out to garner support through vaunting their political stands on China-related issues – a tactic that has prompted loud disapproval from the Chinese public. An important political election is also imminent in China – that of the new central leadership at the 18th National Congress of the Communist Party of China. Recent discord and conflicts that have sprung up between China and the U.S. have triggered debates on exactly where China-U.S. relations are heading. As the world’s two biggest economies, their relationship has global impact. It was under this scenario that the China-U.S. Economic and Trade Cooperation Forum commenced. Its purpose to highlight the full significance of China- U.S. economic and trade cooperation, the forum included keynote speeches and debates with the aim of formulating appropriate ways of developing economic and trade cooperation.
At a time of widespread uncertainty about China-U.S. relations, the forum, themed “expanding common interests and building a community of common interests,” outlined an optimistic road to further development of this bilateral relationship.
There are generally three possible modes of country-to-country relationships: hot war, cold war, or cooperation. The last is clearly the only correct choice for humankind.
How, then, do we deal with contradictions and divergences? In my opinion, we should be cognizant of existing problems while attempting to pinpoint common interests and their potential convergence.
As China’s state leaders, notably Deng Xiaoping and Hu Jintao, have repeatedly pointed out, there are between China and the U.S. co-existent areas of both divergence and common interest, the latter greatly outweighing the former. When addressing bilateral relations, common interests are hence the main focus of Chinese leadership. Although the two countries’ respective interests are not always congruous, convergences nonetheless exist. Building a community of common interests based on such convergences will expand China-U.S. common interests to the point where they become interdependent. As neither side can afford to ignore or prejudice such expanded common interests, taking them into account will make both of them more rational and objective when dealing with differences, contradictions and divergences that arise.
This being the case, exactly what interest convergences do China and the U.S. share with regards to economic and trade cooperation?
Investment cooperation is foremost. At the time of writing, bilateral cooperation in this area has seen progress. The U.S. investment volume in China amounts to US $70 billion. China’s investment in the U.S., however, is less than US $10 billion. Notwithstanding this lopsided development, bilateral investment cooperation has huge potential. American economic growth is still sluggish owing to after-effects of the global economic crisis. Generating economic growth sufficient to create more jobs, therefore, is U.S. President Barack Obama’s only way of lifting the U.S. out of its current depression. China, on the other hand, has accumulated a sizable amount of wealth over 30 or more years of rapid development. The country’s enterprises have both the capacity to invest abroad and the incentive to set up overseas operations.
The United States is the world’s sole superpower, but there remains much room for improvement in its infrastructure. The American economy stands to benefit considerably were China and the U.S. to invest cooperatively in American infrastructure, by virtue of the jobs this would create. Such cooperation would also give China’s enterprises greater scope for development. A truly win-win situation could thus come about.
Another point of interest convergence is that of cooperation between the two countries’ small and medium-sized enterprises(SMEs). China’s private economy creates roughly 80 percent of its jobs, and private enterprises are mostly small and mediumsized. Firms of this size in the United States have also been instrumental in job creation. So far, there has been considerable cooperation between the two countries’ big corporations, but seldom between their medium-sized and small ones. Both have their respective advantages. SMEs in the U.S. usually possess advanced technologies and patents, but lack capital and markets. Although there is generally an absence of sophisticated technology in Chinese SMEs, they have ample capital fueled by China’s huge market. Pushing forward cooperation between the two sides’ SMEs would create a more solid bond in their bilateral economic and trade relations.
Finally, there exists considerable space for bilateral cooperation through tapping U.S. innovation ability and simultaneously promoting transformation of China’s economic growth mode. America is acknowledged throughout the world for its strong innovative ability, and technical innovation is the surest route to regenerating the world economy and dissipating the current depression. Transforming its economic growth mode from that of high pollution and high-energy costs to resource saving and environment-friendly will be a difficult process for China. Technical innovation, however, can facilitate this transformation. The scope for bilateral cooperation in science and technology, therefore, is immense.