Newly-elected US president Joe Biden has “no pressing desire” to continue the trade talks between the US and China and is more likely to focus on Iran and Russia.
In an interview with Magellan chief investment officer Hamish Douglass, former CIA analyst and chief executive of China Strategies Group, Chris Johnson, shared his thoughts on how the US would work with China in the future.
There had been much speculation about what US president Joe Biden would negotiate with China following the US/China trade tensions under the Trump presidency which were increasingly antagonistic.
Johnson told Douglass he expected China would not be at the top of Biden’s agenda and he would be more likely to conduct discussions in private.
“The incoming team have similar concerns on democracy and economic patterns of behaviour about China but they have less focus than the outgoing presidency on the fact that is a Soviet-style competition that undermines our society and democracy, I don’t get the sense that they have that existential feel. That will translate into more discussions behind the scenes rather than in public, better co-ordination and more stability between the two nations,” Johnson said.
“At the top of Biden’s foreign policy agenda will be the Iran agreement, which is challenging, and how to respond to the Russia hack which is a huge issue. There is not a pressing desire to get back into strategic and economic dialogue with China anytime soon.”
He said Biden had already worked closely with China premier Xi Jinping during his time in the Obama administration and had a “good measure” of his character.
“Biden has a good measure of Xi Jinping and is not unaware of what he is dealing with in terms of goals and political acumen. There is an awareness that the Chinese Communist Party is not about to collapse, he will be around as leader until he is ready to leave and the party will not collapse. That is a far sounder judgment to base your strategy around than hoping for collapse.”
The Shanghai Stock Exchange Composite index returned 13.4% over one year to 1 February 2021 compared to returns of 2.3% by the S&P 500.
Performance of Shanghai Stock Exchange Composite index versus S&P 500 over one year to 1 February 2021
