03/18/2010 05:12 am ET | Updated May 25, 2011

Why Obama Understands China Very Well

I will make a rather bold proposition. President Obama understands how to work with the Chinese government better than any recent US President.

Facing a barrage of criticism on his return from his recent Asia tour, President Obama saw supporters and critics alike lambast him for his visit to China, with CNN's David Gergen calling it the worst presidential visit abroad since Kennedy met Khrushchev in Vienna in 1961. This refrain was picked up by both ends of the media spectrum. John Bolton, the former UN ambassador, despairingly sees Obama as being 'unable or unwilling to defend U.S. interests strongly and effectively'.

These views are understandable but narrow-minded. Let us first view where Obama did genuinely fail, the appreciation of the yuan. The common media and popular perception now recognises China as a global player, with a powerful economy and a strong political influence, but has failed to grasp the change in policy this automatically represents. It is true that the Chinese government has been very happy to let the value of the yuan remain pegged to the dollar alongside the euro and yen. This has allowed Chinese exports to remain at rock-bottom prices to the horror of countries like South Korea or Brazil. Obama did not secure any clear achievements in this regard. In this, Obama showed his naivete. If China is now a global player, with the strongest economic performance of the financial crisis, why should it listen to economic demands from any other nation? Let us imagine the furore if Obama had been expected to adhere to financial demands from Hu Jintao. Given China's position as the main holder of US foreign debt, this furore may well soon come to pass.

However, in his other two objectives in China namely climate change and denuclearisation, Obama scored high points. On climate change, expectations had hit rock bottom when in Singapore, Obama announced efforts to seal a long-term deal at Copenhagen had come to a halt. But, as pointed out by Vanity Fair, China and the US would both commit to long-term emission reductions thanks in large part to a back-channel effort between US and Chinese officials begun long before Obama's trip to Asia. Lest the importance of this occasion go unnoticed, this is the first time that the two worst carbon-emitting nations have made such commitments. Why then was this not shouted to the heavens? Why was a gleeful Robert Gibbs not tap-dancing his way to the press room? Because this administration and this president understand a key aspect to Chinese culture.

Face, or lian in Mandarin, that concept of honour and pride that governs so much of business in China has been key to Obama's success. Going back to President Nixon, US presidents have railed against human rights, the horrific treatment of Tibetans and Uyghurs and freedom of expression. These issues are an absolute shame upon China's governing elite and must be dealt with vigorously but such direct criticism from US Presidents achieves little apart from making political hay on Capitol Hill. By instructing his diplomats to work with their Chinese counterparts under the radar, Obama achieved three things: signalling to the Chinese government that there would be a new way of doing business, allowing the Chinese government to save face and closing commitments on climate change and the Iranian nuclear problem.

This week, very shortly after Obama returned to the US, China and Russia agreed for the first time in four years supported a US-led resolution denouncing Iran's nuclear program. This should quell any fears that Obama's criticised soft approach to diplomacy bears no fruit.

This understanding of face has been evident since Obama took office. This is a president who bows to the King of Saudi Arabia and to the Emperor of Japan, who begins with a speech in Cairo with the greeting 'Asalaam 'Alaykum', because he understands that while Fox News froths about Anti-Americanism, such gestures of respect can change the world.