June 12, 2020

US Presidential Election, COVID-19, China and the future of the world

June 12, 2020

On June 8th, 2020, Fulbright University Vietnam hosted a talk on the “US Presidential Election, COVID-19, China and the future of the world” with two illustrious guests. Nelson Cunningham is the president of the international advisory firm McLarty associates, former special adviser to President Clinton and general counsel of the Senate Judiciary Committee under Senator and presidential candidate Joe Biden. His Excellency Ambassador David Shear is a senior advisor at McLarty associate and the former Assistant Secretary of Defense for Asian and Pacific Security Affairs from 2014 to 2016. Prior to that, Ambassador Shear had 32 years of distinguished career in the US foreign service, including three years as the ambassador of the United States to Vietnam, based in Hanoi. He also served for the diplomatic missions in Sapporo, Beijing, Tokyo and Kuala Lumpur. The talk was mediated by Mai Huong, member of the board at Fulbright University Vietnam and the chairwoman of global communication consultancy network Publicis.

This speaker series organized by Fulbright aims to engage experts from a variety of fields, from academia to business and policymaking, to discuss current Affairs and events, politics, economics and, social changes, with a special focus on the COVID-19 as it continues to influence our society, our economy, and our politics.

In this talk, Ambassador Shear and Mr. Cunningham discussed how intensifying competition between China and the US have made foreign policy a key feature of the upcoming election, what it means for regional geopolitics in South East Asia and Vietnam, and how Vietnam stands to benefit.

Intensifying competition between US and China

“In order for us to avoid a crisis, or for us to manage crises in a stable fashion, the US China relationship really needs three things. One is trust. One is communication at the senior-most levels, and one is restraint. And I think we have seen a diminution in all three of those lately,” says Ambassador Shear.

Nelson Cunningham is the president of the international advisory firm McLarty associates, former special adviser to President Clinton and general counsel of the Senate Judiciary Committee under Senator and presidential candidate Joe Biden

In the past 30 years, the bilateral relationship of the two countries were based on common interests, while differences were still inherent. Though the two countries cannot eliminate their differences, they were willing to work together to narrow the gap. A fact that seems to have changed in recent years, marked by a serious downturn. “During the era of George H W Bush and Deng Xiao Ping, we believed there were strong common interests between China and the United States, and our ups and downs always seemed to have a floor,” reflects the expert, “but it’ s not clear that there is a floor under US China bilateral relations now.”

The downturn in US China bilateral relations has been a trend since at least 2017 when President Trump came into office, according to Shear, and has only been exacerbated by the current COVID crisis and the US presidential election. The ambassador outlined 5 key aspects of this deeper shift in diplomatic relations.

First among them, says the ambassador, is “blame shifting, finger pointing, and name calling on both sides.” Both President Trump and Secretary of State Pompeo have been called liars by the Xi administration. Meanwhile, President Trump’s stance on the alleged Chinese responsibility for spreading the virus has received wide coverage in the media.

This direct, public, and antagonistic behavior is only further aggravated by a lack of direct communication between US and Chinese senior-most officials. “That communication link has been extremely important in providing stability to bilateral relations historically for previous presidents. But the current President’s communication with President Xi is sporadic at best. His last phone call with President Xi was March 26. The same can be said of communications between Secretary of State Pompeo and Secretary of Defense Esper with their Chinese counterparts,” emphasizes the expert.

­A third characteristic of this downturn is the increasing tensions associated with the situations in Hong Kong, across the Taiwan Strait, and in the South China Sea. As the ambassador recalled, the president’s address a week prior had very strong words for Chinese behavior in Hong Kong, and their passage of a national security law which greatly strengthens Chinese law enforcement activities in the special administrative region. This increased tension is also made evident by increased US and Chinese military operations in the vicinity of Taiwan and the South China Sea.

The potential for renewed trade friction between the US and China is also a factor, despite a phase one trade agreement signed by both parties in January. But the Chinese and maybe even the US will have a hard time implementing that trade agreement in the face of the COVID crisis. Yet Ambassador Shear remains optimistic since “the US Trade Representative communication with China appears to be an exception to the overall lack of communication between the two sides, with the USTR stating publicly twice that the talks on implementation of the phase one agreements appear to be progressing. It may be a sign that the two sides are willing to show restraint in the way in which they handle bilateral trade frictions.”

Finally, there is a trend of increased US congressional action on China. Over the course of last year, the U.S. Congress passed the Hong Kong Human Rights Act, which forms the basis of recent US actions to potentially withdraw special treatment of Hong Kong in trade and other areas. Congressional action could also be observed on the Chinese treatment of Uyghurs in Xinjiang. There have also been efforts in congress to more strongly support Taiwan’s efforts to maintain diplomatic recognition with the 15 countries that still recognize its sovereignty.

All these trends demonstrate a bipartisan change in attitude in Washington and Beijing alike. China is increasingly seen as practicing what is called in America ‘wolf warrior diplomacy’ to assert their claims. As Shear explains, “Wolf warrior refers to a 2015 action film, featuring Chinese Special Forces units fighting a variety of enemies of China, including the United States. That term wolf warrior has caught on to describe the aggressiveness and the outspokenness with which the Chinese are now pursuing diplomacy.” The ambassador shared two examples. In Australia, the Chinese ambassador in Canberra scolded Australians for proposing that the international community conduct an inquiry on the origin of the Coronavirus. The Chinese government’s subsequently imposed limits on Australian beef imports into China. Secondly, Vietnam and other ASEAN claimants in the South China Sea are also familiar with Chinese activities in the region, including the recent sinking of a Vietnamese fishing boat.

Ambassador David Shear is a senior advisor at McLarty associate and the former Assistant Secretary of Defense for Asian and Pacific Security Affairs from 2014 to 2016

Meanwhile as Cunningham explains, “China is increasingly seen as a competitive threat to the United States because of the policies of President Xi and his administration.” Cunningham recalls that the last 30 years had seen Republicans and Democrats alike working collaboratively to bring China into a system of multilateral agreements, through trade and extensive people to people exchanges, and perhaps even liberalizing the country to a certain extent. But Cunningham explains that “although it appeared to be working under Hu Jintao, it became clear that that approach had to change in response to Xi Jinping’s leadership.”

South East Asia in US foreign policy

The sharp downturn in US-China relationships consequently brought China to the front stage of US politics, with China becoming, for the first time in decades, a central issue in the US presidential campaign. “We’re going to see in this election both sides vying for who’s going to be tough on China,” he explained. Therefore, both parties will see an increase in negative rhetoric relating to China, but also a stronger focus on foreign policy compared to most election cycles.

Cunningham explains that presidential candidate Joe Biden’s platform includes a deepening or strengthening of American ties to its allies. “He wants to bring back the America that our allies and trading partners around the world have known, trusted, and worked with. Renewed and normalized ties with Japan, South Korea, and all of our friends and allies in Southeast Asia are a centerpiece of his administration’s policy.” Cunningham emphasized the interest, for a potential Biden administration, of increasing the US level of engagement in South East Asia. “We need to try and support the emergence of a strong, prosperous Vietnam and a strong, prosperous Southeast Asian region.” For Ambassador Shear, that increased cooperation between the United States its allies and partners is important for maintaining stability in the region where Vietnam in particular can expect a continued increase in US cooperation.

Both speakers also discussed the Trans-pacific Partnership (TPP). In American domestic politics international trade has become a potential issue, with a strong focus by the current administration on the trade imbalance. This would be less the case in a Biden administration, but as Ambassador Shear says, “we need to find new avenues and build new structures for international cooperation to face China.”

“The TPP was a brilliant strategy to bring together the United States and its largest trading partners, including the Southeast Asian countries, but also to function as a powerful incentive for China to play by international rules,” reflects Cunningham. But although the Chinese approach to international diplomacy has hardened, the importance of fostering ties remains. “I don’t think we will see the US enter the revamped Transpacific Partnership. But I will certainly see the United States embrace the goals of it, and perhaps promote a new way to bring together our allies in what will certainly be a difficult and confrontational relationship with China.”

Opportunities for Vietnam

Some might worry that Vietnam will be stuck between two giants or forced to ‘pick a side’. But for Cunningham, it is not in the U.S.’ interests to force a choice. “We have to work to build a relationship in ASEAN that is not based on an us vs them strategy. It is not saying ‘you have to be with us, or else.’ It’s saying instead, ‘here’s why you want to be with us.’ Because of the trade ties, because of the multilateral cooperation, because of the people to people ties between us and Southeast Asia,” says Cunningham.

For the ambassador, Vietnam also stands to benefit from increased leverage in their negotiations with China, conducted on a variety of issues, on a daily basis.  As he explains, “strong engagement by the US in the region increases everybody’s leverage vis a vis China. And the stronger all of our leverage is, the better we’ll be able to secure our interests vis a vis Vietnam’s big neighbor to the north.”

Vietnam is also uniquely positioned to benefit from increased competition between the different trading regions. For Cunningham, if China continues to open its market and to have rules that are attractive to foreign investors, Vietnam’s industrious workforce and good infrastructure are key factors that could allow the country to benefit greatly from these global trends.

Vietnam does not only stand to gain from the shift in supply chains. It is a prime candidate for the establishment of supply chains that move from China, as well as new supply chains through greenfield investments. As Ambassador Shear points out, Vietnam has seen increases in foreign direct investors and leasing of factory and warehouse spaces, as supply chain capacity in the country grows together with the rapid construction of new economic and industrial zones. For the ambassador, this trend of outflow of supply chains from China will steadily continue. “Countries will be very cautious about the speed and extent to which they move their supply chains out of China, partly because of the highly skilled Chinese workforce, partly because of the very dense and efficient supply chains that have developed throughout China particularly in the Pearl River Valley. This isn’t going to be an avalanche, but a long-term phenomenon.”

“The globe has recently taken notice of Vietnam’s efficient control of the management of COVID-19 which demonstrates increased governance capability not only at the central level in Vietnam, but the local level as well. I wish to congratulate my Vietnamese friends on how they’ve managed the COVID crisis, but also on how well they’ve increased the ease of doing business for foreign direct investors in Vietnam,” concluded Ambassador Shear.

Thach Thao

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