China should keep low-profile to prevent trade spat from turning into cold war: expert

China has laid bare its weakness in the field of high technology development in the trade spat with the United States, and should be well prepared to face obstacles in its quest for global technological leadership, according to an expert.

Zheng Yongnian, director of the East Asian Institute of the National University of Singapore, said at a recent forum on globalization in Beijing that the trade spat between China and the United States is not a pure fight for trade supremacy but a "cold war of technology", in which the United States appears to have gained an upper hand by slapping a ban on China's telecommunications company ZTE.

Zheng is a little pessimistic about the prospects of the trade talks, even though the Chinese delegation led by Vice Premier Liu He has reached some agreements with the United States.

"The trade friction between China and the United States is just a beginning, and more tough tasks are in the offing. For the Chinese and American economies, cutting the US deficit with China by $50 billon or $100 billion is no big deal, and is just a pressure test by the Trump administration for China," said Zheng.

Zheng said that China has ignored the influence of the military interest group in the US government, which wants to fight a cold war with China. Another interest group in the Trump administration is made up of business heavyweights, which also wants to fight a trade war with China. Zheng showed support to Chinese President Xi Jinping's notion that the American business interest group will be inclined to the cold-war mindset held by the military interest group if China also adopts protectionism in protest against Trump's challenges.

In Zheng's opinion, Trump has realized a periodical goal by ordering American firms to stop selling technologies and software to ZTE for seven years in what the political scientist calls the "cold war of technology".

Analysts said that the ban would bankrupt the Chinese telecommunications company, which uses American-built chips to power its smartphones, which are said to be very popular in the developing countries.

On Monday, a Wall Street Journal report revealed that China and the United States were working on an agreement for the lifting of the ban, citing unidentified sources familiar with the matter. But later, Trump said that there was no deal with China on ZTE. The obscure information was followed up by Chinese media reports on Wednesday which claimed that ZTE is preparing for deliveries after the ban is lifted. A final agreement on ZTE is expected to be struck at next week's trade talks which will reportedly be attended by US Commerce Secretary Wilbur Ross.

Zheng said that the American ban on ZTE has raised other Western countries' vigilance about China's technological ambition, adding that it may bring more challenges to Chinese efforts to import technologies from developed countries.

Moreover, the expert said that the trade spat between China and the United States was overhyped by the extreme patriots from both countries.

Zheng suggested that China should keep a low profile at the present time when the "Belt and Road" initiative and the "Made in China 2025" blueprint, which Xi hails as vital in his ultimate goal of revitalizing the Chinese nation, are misinterpreted as a tool to seek global hegemony.

The principle of hiding one's capabilities and biding one's time, which was advocated by Deng Xiaoping, the chief architect of China's economic reforms and socialist modernization, is still relevant at present, said Zheng.


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