China's Shopping List for Obama

Without a skeptical electorate or an independent media snapping at his heels, there seems on the surface to be less at stake this week for China's President Hu Jintao than for his American counterpart.
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At the end of the 18th century, Britain's first ambassador to China, Lord Macartney, arrived in Beijing to present a list of requests to the emperor Qianlong. His petition, it was hoped, would open China's vast and untapped market to the sale of British exports. The mission was not exactly a shining success - after a series of awkward meetings in which each side apparently made every effort to affront the other's code of etiquette, Qianlong sent him packing, noting that "[since] we possess all things, I set no value on objects strange or ingenious, and have no use for your country's manufactures."

To read much of the media coverage of Obama's upcoming trip to China, one could be forgiven for thinking that the President is walking in Macartney's footsteps, offering his shopping list up for consideration by an inscrutable group of Mandarins, the success or failure of his administration's China policy dependent on their whims.

This is not the case. Although little mention of it has been made, there is every indication that Obama's meeting with China's top brass will be much more of a two-way affair. This week, China's media has been full of speculation over what kind of concessions their own leadership might be looking to extract during the visit. Some will be familiar, others less so. Here, in brief, is their shopping list:

  • Climate change - common interest over halting global warning means that China will be unlikely to try to pull anything that could jeopardize U.S. efforts to get climate legislation past. Without a senate bill in place, it's unlikely that any firm agreements will be signed, but expect at least a joint communiqué on the issue.
  • Clean energy - the strong mutual interest in Sino-American cooperation on creating a clean-tech market has already been widely covered. Less well-known is China's desire for US help on building up its fledgling nuclear power industry. While China has enjoyed cooperation with other developed countries on the issue (most notably France), the US has thus far been reticent. Chinese analysts are looking for some sort of breakthrough here.
  • Technology transfer - China will be hoping for a relaxation of restrictions on all but the most sensitive American hi-tech imports. It may also hope to leverage its position as a world leader in solar and wind technology as a bargaining token here.
  • Debt - ever since the financial crisis, China's top financiers have been twitchy about their massive holdings of US government bonds. China's continued purchase of American debt will probably be conditional on some serious reassurance that their assets are secure, and that the US has a long-term strategy to rein in its titanic deficit.
  • Economic status - China has been anxiously seeking US confirmation of their status as a fully-fledged market economy for quite some time. America taking the lead on this would likely trigger similar responses from Europe and Japan resulting in substantially better treatment for Chinese goods abroad, as well as cutting trade disputes. While dramatic steps on the issue are unlikely this time round, Chinese negotiators will be hoping to extract some form of timetable on the issue.
  • National Security - while they may be great fodder for domestic nationalism, continued military altercations in the South China Sea are as awkward for China as they are to the US, perennially threatening to upset the apple-cart of an otherwise stable relationship. A polite request to reduce and ultimately stop US incursions into China's 'exclusive economic zone' is likely to be on the table. And while there is little hope of halting US arms sales to Taiwan, China will be hoping to score a symbolic victory by at least delaying an upcoming shipment of F-16s to the breakaway island.
  • Disneyland - while it might seem like an unnecessary distraction given the short duration of Obama's stay, an appearance at the construction site of Disneyland Shanghai would give 'face' to both China's modernization efforts, and the aspirations of its expanding middle class.

Without a skeptical electorate or an independent media snapping at his heels, there seems on the surface to be less at stake here for China's President Hu Jintao than for his American counterpart. But Hu's handling of the visit will not go unnoticed at home. A perceived Chinese 'win' here will be vital to keeping China's unruly constituency of nationalists onside, while signs of weakness could harm him in the opaque jostling for position surrounding the election of his successor, and his influence in retirement.

While it's tempting to portray the visit as a straightforward litmus test for US foreign policy, we would do well to remember that this particular game remains very much a two-sided one.

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