With no clear winner after Phase I, both sides must come to the table with clearer objectives and a willingness to make major concessions if there is to be a lasting peace with benefits for all, veteran dealmaker Weijian Shan writes in Foreign Affairs
An equitable and sustainable settlement between the US and China would deliver greater growth and benefit the global economy. But in order to get there, leaders in Washington and Beijing need a dose of realism, clearer thinking and a willingness to compromise, writes Weijian Shan in the latest edition of Foreign Affairs journal.
"The United States must decide whether what it really wants is access to the Chinese market and better prices for US consumers, or whether it simply wants to contain China’s rise at all costs," Shan, a co-founder of Hong Kong-based private-equity firm PAG Group. "Washington cannot have it both ways."
There can be no lasting settlement if the US pursues the latter aim, he said. On the other hand, the former is both achievable and consistent with China's state position.
Still, to get there, Xi Jinping must be true to his words and deliver on pledges to reform the state-owned sector, "not just because doing so may entice the United States to stop the trade war but because such reforms will be good for China," he said, pointing out that earlier periods of market reform have coincided with higher economic growth.
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