The 30th APEC Economic Leaders’ Meeting is underway in San Francisco. Chinese President Xi Jinping and US President Joe Biden will meet during the event, which has already attracted great attention from worldwide. Will it become a turning point of the China-US relationship? How will the US’ sanctions on Chinese companies affect the sentiment at the summit? Jeffrey Sachs (Sachs), a world-renowned American economist, shared his insights on these questions. In an exclusive interview with Global Times (GT) reporter Wang Zixuan, Sachs explained why he is confident in China’s economy, and stressed that the US foreign policy toward China in recent years has been ineffective, misguided and crisis-provoking.
GT: The San Francisco summit has been regarded as a chance to ease China-US tensions. How do you think this summit may affect the China-US relationship?
Sachs: The Biden administration may be looking for an easing of tensions at this stage, since the US situation is not good. The US now is enmeshed in two dangerous and costly wars, in Ukraine and in Gaza. In neither situation is the US ally (Ukraine, Israel) in good shape. The US itself is deeply divided politically, and is entering the frenetic period of an election year. The president is unpopular. All of this means that both foreign and domestic tensions are very high, so the US may therefore choose to ease the China-US tensions. This would be highly desirable, as the US foreign policy toward China in recent years has been negative, ineffective, misguided and crisis-provoking.
GT: The US has imposed sanctions on a number of Chinese companies several weeks before the summit. Some are concerned that the summit may be tainted with political sentiments. What’s your take?
Sachs: The US should agree with China to end this pattern of unilateral sanctions, and to negotiate the withdrawal of these sanctions. In my view, the US trade and technology policies have been self-defeating, unsuccessful, and very often in violation of WTO principles. The US should agree with China that major bilateral trade, technology and financial measures will be negotiated in the future, and in compliance with international rules, rather than imposed unilaterally without prior negotiation or consultation, and in violation of WTO standards.
GT: In your recent article, you mentioned that “Western press is filled with China’s supposed misdeeds… Yet much of the slowdown is the result of US measures that aim to slow China’s growth.” Why are you confident in China’s economy? Why did you say the policy of containing China will backfire on the US?
Sachs: China is not in a “middle-income trap,” as is widely portrayed in the Western media. The whole idea is ridiculous in my view. A middle-income trap is caused by a failure of a country to climb the technology ladder, as in many Latin American countries in past decades. By contrast, China is making huge advances in 21st-century technologies, and China is a high-quality, low-cost global producer of many of the key cutting-edge technologies, such as 5G, fast rail, large hydropower, long-distance power transmission, photovoltaics, electric vehicles, advanced computers, to name a few.
GT: Some have said that the US economy has been impeded by political dysfunction, and the US-led Indo-Pacific Economic Framework (IPEF) didn’t perform well. However, many countries have recognized the China-proposed Belt and Road Initiative as a success. What is the fundamental reason for this situation? What’s the key to achieving a win-win result for both China and the US?
Sachs: China is a high-saving country with a successful record of modern infrastructure investment, including thousands of kilometers of fast inter-city rail, 5G, long-distance power transmission, among others. The BRI aims to make these technologies available to China’s trade partners, which is a win-win proposition. The US is a low-saving country which has not modernized much of its infrastructure in decades, for example, there is no fast rail, and EVs constitute a small proportion of new car sales. Also, the US political system is not very much interested in the low-income developing countries, whereas China is. And it also has practical experience and technologies to share with them. The US and EU should aim to cooperate with the BRI, for example in ASEAN countries and in Africa.
GT: APEC is an important organization for multilateral economic cooperation in the Asia-Pacific region. Under the intensifying tensions, what positive role will the APEC meeting play in the economy and development of the Asia-Pacific region?
Sachs: If China and the US announce a return to cooperation, not only APEC countries but the entire world will breathe a huge sigh of relief. The US has caused these tensions with the idea of engaging in an economic war to “contain” China. This was a terrible and naïve idea. I hope that the US is ready to drop it, but this is clearly unlikely. There are still many US politicians that have a naïve, poorly informed anti-China attitude. Biden should now use the APEC meeting to end the dangerous and misguided US policies of recent years.
