Stability is China's key concern, not foreign spats
By Jason Leow
BEIJING - Remember 2020?
That's the year China hopes most of its citizens will become middle-class. China calls this dream, born last year at the 16th Communist Party Congress, xiaokang shehui, or literally, 'all-round, well-off society'.
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The aim is to spread the wealth around the country, now sharply split by income, and quadruple gross domestic product to US$4 trillion (S$7 trillion).
Towards this end, China needs peace and stability.
All poli- cies, whether domestic or foreign, are to ensure the country gets the peace and stability to grow rich quick.
This is why, in the past month, Chinese leaders have embarked on what the media has termed a 'charm offensive' to win public favour. During the hobnobbing with foreign leaders, they also signed a raft of trade deals.
The charm ensures that China makes friends all round, giving the country the peace it needs to focus on domestic growth.
China even has an explicit foreign policy name for this strategy: all-round friendly relations. In a phrase: All foreign is domestic.
Then there are the signed deals which give China the goods and services it needs to grow.
What's the point in this big-picture summary of China? It is to put the current Sino-American trade conflict in perspective. The quarrel is now on the yuan peg and China's seeming reluctance to open up its market faster for US trade and businesses.
The simple way to understand the present stand-off?
The United States can make all the noise it wants, send Treasury Secretary John Snow and Commerce Secretary Don Evans on trips between Washington and Beijing, and even pass a resolution, as it did on Wednesday, calling on China to drop its yuan peg and honour international trade commitments.
China will do so when it is ready. Meanwhile, it will sprinkle goodies and concessions to make the US happy.
On Wednes- day, Beijing announced a multibillion-dollar deal to buy American goods, including planes and jet engines, to shave off some of last year's US$103-billion trade surplus with the US.
The deal is to soothe the US establishment, which believes China's protectionist attitude towards trade hurts foreign relations. The establishment also wants to be heard in a way that only the world's most powerful nation can demand.
But believe it, the US is a mere distraction in China's foreign policy when unemployment and uneven growth are more pressing issues.
The other distraction is North Korea. But as that country is hard to predict, China's strategy is just to pray - for the best outcome.
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