What the U.S. Election Outcome Means for China

China-US Focus | November 03 , 2024

---

By Wang Huiyao | Founder of the Center for China and Globalization(CCG)

---

 

The U.S. presidential election is reaching a critical point, with both parties’ candidates in the final sprint and polling neck-and-neck. The close race has captured global attention, and China is no exception.

As the world’s two largest economies, the United States and China have a complex and pivotal relationship, and the election’s outcome will undoubtedly shape the future of their interactions. From trade and security to technological competition and climate cooperation, U.S. policies on China under the next administration will have profound and lasting effects, not only on bilateral ties but on the broader international order.

Regardless who is elected, the structural tensions are an undeniable reality and have become a widely accepted bipartisan consensus within the U.S. Changing this consensus will require time and joint efforts from both sides. With both the Chinese and U.S. governments already navigating these dynamics, the question remains: How can both nations move forward? I hope to offer some analysis and insights on the possible outcomes and their implications on this most important bilateral relationship for the world.

If Trump wins: Higher tariffs but pragmatic cooperation

If Donald Trump wins the election, he says he will impose higher tariffs on imported goods, especially those from China. He has indicated that he considered imposing a comprehensive tariff of 10 to 20 percent on all imported goods and a 60 percent or higher tariff on Chinese goods. In addition, if he selects a hawkish team to dominate U.S. policy, his administration likely will not only force Chinese enterprises to reduce exports to the United States but may also reduce non-governmental contacts between the two countries, such as educational and academic exchanges, thus impacting public perceptions on both sides.

However to fulfill his promise of being a peace-making president, Trump may have to seek cooperation with China. He has repeatedly claimed that he has the ability to end the Russia-Ukraine war within 24 hours — or even before his inauguration. He is also promising to end the Israeli-Palestinian conflict. Although this claim is suspicious given the complexity of the Middle East and the Russia-Ukraine war, Trump cannot fulfill his promises without China’s help. He previously sought help on the North Korea nuclear issue, and at the end of 2016 China voted in favor of sanctions against the DPRK at the United Nations, demonstrating its important influence in regional affairs.

China is the largest trading partner of both Russia and Ukraine. These close economic ties give China a unique opportunity to play a greater role in peace-making efforts. Similarly, in the Middle East, China is the region’s largest trading partner and has helped facilitate reconciliation between Iran and Saudi Arabia, as well as the release of the Beijing Declaration by 14 Palestinian factions. China can potentially help Trump truly become a peace-making president.

Trump may also continue to push for negotiations on economic and trade issues involving China. Trump is a pragmatic politician who focuses on solving specific problems. During his previous term, he completed the Phase One China-U.S. trade deal, showing a pragmatic attitude on economic issues such as the deficit problem and trade surplus. If Trump is re-elected, the two sides could further discuss subsidy policies, intellectual property protection, overcapacity issues, balance of trade and other things. This pragmatic strategy also means that Trump may value specific results over ideology. Therefore, in practice, Trump may choose to continue negotiations on economic issues to protect U.S. interests.

Trump has a relatively open attitude toward Chinese investment in the United States and may take multiple measures to encourage or require Chinese enterprises to invest and set up factories there. During the campaign, Trump repeatedly stated that he hoped to encourage the return of the manufacturing industry through higher tariffs and welcomed foreign-funded enterprises to set up factories in the United States. Because of the China-U.S. trade war, a large number of Chinese enterprises that had wanted to enter the U.S. market set up factories in Mexico instead.

Trump has said that if Chinese enterprises can adhere to U.S. requirements, he would welcome Chinese car manufacturers building factories in the United States. This would open up new space for China-U.S. economic cooperation. Fuyao Glass has already set up factories in the U.S. and taken root. CATL is currently negotiating with American enterprises about investment and establishing a presence. Elon Musk’s support after the election could encourage Trump to take a more pragmatic approach, especially given Tesla’s extensive operations in China. In contrast, the current administration’s policy in this regard is more conservative. It has even blocked investment by some Chinese enterprises.

On the Taiwan issue, Trump may continue to maintain a pragmatic attitude, and the two sides may continue to communicate on the basis of maintaining the status quo. Trump has said that Taiwan should pay the United States for protection, explaining that it’s similar to buying insurance. If Trump comes to power, he may stick to the “one China” policy and reiterate the three communiques endorsed by all U.S. presidents in the past.

If Harris wins: Status quo with China and more certainty

If Kamala Harris is elected, she will most likely inherit the policy of “competitive rivalry” established by the Biden administration and continue to adhere to the “investment, alliance, competition” trilogy, balancing China’s influence by strengthening relations with U.S. allies. In trade and industry, she may continue to promote industrial chain coordination with allies and oppose the imposition of high universal tariffs on China, but she will focus on competition in key strategic areas. In technology, she is expected to continue to strengthen the competitive thinking of “invest in America” and “small yard, high fence,” strengthen the monitoring of U.S. technology companies and keep playing the China-U.S. technology containment game. But overall, Harris’s election will also avoid directly intensifying the China-U.S. conflict and maintain the current state of affairs.

Harris’s background in California and her knowledge of the Asian-American community gives her a certain understanding of the complexity of the China-U.S. relationship. Harris came up in California, and China is California’s largest trading partner. The most economically developed state in the United States, California has more than 6 million Asian-Americans, of which about 2 million are Chinese-Americans. Her vice president, Tim Walz, also has a rich knowledge of China. He previously worked as a teacher in China, knows some Chinese language, spent his honeymoon in China and organized more than 30 study tours to China for American students. These experiences give Walz a direct understanding of Chinese culture and society, which may help the Harris administration to pay more attention to long-term communication and non-governmental sectors when managing the China-U.S. relationship. This may also help to avoid alienating Asian-Americans and other immigrant groups in the United States by imposing overly tough policies on China.

The Harris administration may also try to strengthen bilateral dialogue and communication channels in its relations with China to establish cooperation pipelines. After the China-U.S. summit in San Francisco last year, the two sides resumed a number of exchange mechanisms, with continued dialogue on climate change, artificial intelligence, fentanyl, defense, trade and finance. And cooperation will continue. Harris briefly mentioned China in her nomination speech, and her tone was relatively mild, indicating that she may prefer to maintain a competitive advantage over China in the future.

Possible pathways for U.S.-China relations

Regardless of the outcome of the election, there remains vast potential for cooperation between China and the United States. Together, they could work toward global peace and address a host of pressing challenges, including not only the Russia-Ukraine war and tensions in the Middle East but also climate change, AI governance and the debt burdens of Global South countries. Collaboration on these issues would address shared responsibilities, benefiting not just the two nations but the world as a whole.

Both China and the United States should consider in advance how to “synchronize” in the event Trump is re-elected, including on issues such as the Russia-Ukraine war and the Taiwan question. China and the United States should coordinate their efforts toward peace, leveraging China’s influence on the Russian side and in the Middle East to help Trump fulfill his promise of being a peace-making president. This would establish a foundation for cooperation between China and the United States on international peace.

The Taiwan question is a core issue for China and the United States. It may be possible to consider making a new joint statement to clarify the positions of both sides to avoid misunderstandings and misjudgments. Such a statement could potentially reiterate the content of the three China-U.S. joint communiques, emphasize the importance of the “one-China” principle and encourage both sides to resolve differences through peaceful means — maintaining the status quo.

If Trump is elected, China-U.S. economic and trade investment cooperation could improve, and China’s advantages in manufacturing could be leveraged to achieve a win-win outcome with the United States. On tariffs, China could suggest practical cooperation on the premise of reducing some tariffs to drive the recovery of the U.S. manufacturing industry through investment, technological cooperation and other ways, which would create jobs for the United States and help revitalize local economies. China’s manufacturing advantages can supplement the U.S. supply chain and help both sides achieve a mutually beneficial result on economic issues. Further, second-phase negotiations could also go forward on trade to improve the China-U.S. trade relationship through practical discussions and cooperation.

The consensus reached in San Francisco should be consolidated and implemented, with high-level dialogue channels kept open. China’s five-year proposal to welcome 50,000 American youth to China would enhance friendly exchanges between both peoples. If Harris is elected, it is likewise hoped that both sides will continue to implement the points of agreement reached by the presidents in San Francisco.

China should also vigorously promote openness in inbound tourism. It would be beneficial for China to establish a visa-free policy for the United States similar to what’s in place for 20 European countries. China and the United States should also increase the number of resident journalists in both countries, as it is of great importance to have a real, broad and comprehensive understanding of each other.

Expanding access to platforms such as Google, Facebook and Twitter in China could also foster a more open exchange of information and culture between the two nations. The U.S. should consider pulling back from restrictions on platforms such as TikTok, as mutual access to digital spaces would enhance understanding and communication, reduce tensions, build trust and support a healthier, more balanced digital ecosystem.

Conclusion

After two U.S. administrations and eight years of U.S. pressure and containment on China, China has remained resilient, continuing to grow and evolve. Unlike the former Soviet Union, China is deeply interwoven with both the U.S. and the global economy, making any separation difficult. This interconnectedness may gradually guide both nations toward a more pragmatic approach, finding common ground for peaceful coexistence. As Joseph Nye said in my dialogue with him, U.S.-China relations often follow a cycle, and while we are currently at a low point, there is potential for recovery. Similarly, as Graham Allison noted to me, the Thucydides trap is not inevitable, and with mutual understanding and cooperation it can be avoided.

U.S.-China relations are among the most consequential in the world, impacting global stability and growth. The two have a shared responsibility to navigate and strive to resolve the problems of climate, economic development and conflict. the international community looks to these two powers to foster a more balanced and cooperative relationship. While uncertainties remain, constructive efforts from both sides can pave the way for a stable, mutually beneficial path forward.

From China-US Focus, 2024-11-3