On Monday, U.S. President Donald Trump authorized the Office of the United States Trade Representative to begin a probe of China’s trade practice, with a particular focus on the alleged theft of American technologies and intellectual property. The announcement came just days after China’s support of United Nations Security Council Resolution 2371, which mandated unprecedented, harsh sanctions on North Korea.
Although the trade investigation does not lead to immediate sanctions on China, the move signifies a negative tone and punitive direction for U.S.-China trade relations. Such a power play against Beijing despite Chinese cooperation on North Korea not only threatens to derail Trump’s China card in North Korea, but also begs the question of why the U.S. president is linking these two issues in this way at all. The gamble sends mixed messages to China and makes it increasingly more likely the two powers will fail to cooperate on these crucial affairs.
The North Korea and trade policy linkage was in fact proposed by President Trump himself not too long ago. In a tweet in April after his meeting with Chinese President Xi Jinping, Trump claimed that China would get a far better trade deal with America “if they solve the North Korean problem.” This logic would suggest that China’s cooperation on North Korea would be reciprocated by more American leniency on the trade front. The flaw of the logic, of course, is the assumption that China could “solve” the North Korean problem. Even if China has the capacity, it is reluctant to do so because the solution Trump desires under the current circumstances is not perceived by the Chinese to be in their long-term national interests.
Trump's logic would suggest that China’s cooperation on North Korea would be reciprocated by more American leniency on the trade front.
When China examines the future of the Korean Peninsula and the prospect of a unification led by South Korea through absorption, its most important concern is over the future of the U.S. military alliance with South Korea and whether U.S. troops will be deployed to the north of the 38 parallel, even along the Chinese border. For Beijing, that scenario would represent a major threat to China’s national security in the northeast and a vital setback to its strategic influence in the region. Compared with the tension and danger associated with the North Korean nuclear crisis, the collapse of North Korea and the potential prevail of American influence on the Korean Peninsula evidently represents a bigger problem for Beijing.
In this sense, China will not and cannot meet Trump’s criteria of “solving” the North Korea problem because the cost-benefit analysis simply does not support such a move.
Similar concerns influence Chinese calculations on the trade front. Although Beijing aspires to have a good relationship with Trump, when such positivity is priced at China’s compromise on trade practice and market access, the Chinese wonder whether the rhetorical reciprocity they receive justifies the concrete costs. After all, China’s support of the U.N. sanctions resolution on North Korea did not stop Trump from launching the trade probe, which, according to the U.S. president, “is just the beginning.”
China will not and cannot meet Trump’s criteria of 'solving' the North Korea problem because the cost-benefit analysis simply does not support such a move.
The unfortunate link between the two issues also muddles Trump’s North Korea policy. Some might make the technical argument that Trump in fact delayed the announcement of the trade probe so as to not affect the Chinese support of the U.N. resolution. It can also be argued that a probe of China’s trade practice does not equate to punitive measures and leaves significant time and room for negotiation and maneuver. If the trade move by Trump indeed was based on such calculations, it will make him vulnerable to domestic criticisms of him being soft on China and would negate his campaign commitment to contain Beijing. And if it isn’t, China will continue to be suspicious of his intentions.
Given the complexity of the North Korea issue and U.S.-China trade imbalance, it is hard to see a good solution to either problem play out in this current backdrop. Even if mutually agreed solutions exist at all, they would be found through long and painstaking processes of negotiations. Considering the critical impact of the two issues in terms of U.S. national security and economic interests, respectively, it is inconceivable that America has the ability to make major concessions on either front even if China cooperates on the other. Will America tolerate North Korea’s nuclear provocation in the region if China opens its market to U.S. dairy products? Or will America stop pushing China on its theft of U.S. technologies if China stops its trade with North Korea? The answers are most likely negative.
Yet there is some glimmer of hope. China eagerly seeks a positive relationship with Trump. After all, the Chinese favor transactions and would love to probe what American interests could be up for negotiation. In particular, in light of the upcoming 19th Party Congress and Trump’s planned visit to China, Xi very much needs a friendly, supportive Trump to strengthen and promote his political agenda at home. But China’s limited cooperation on North Korea will not lead to the solution Trump wants China to deliver. And weaving the issue of North Korea together with China trade policy will only complicate the picture. Something has to give, and the ball appears to be in Trump’s court.