Daria Novak, a former U.S. State Department official with significant experience in Chinese affairs, authored this column. She writes each Friday on related topics.

Chinese government officials, and even some trade experts in Beijing, breathed a quick sigh of relief as the 96-page, Phase One of the US-China trade deal was inked on January 15, 2020. But does it represent more than a short respite in the trade war?

Unlike previous American administrations President Trump demanded, and won, real concessions from the Chinese along with rules for enforcing those changes. The US stood its ground in the trade talks and refused to accept the small, incremental moves offered to and accepted without reciprocity by previous American administrations – Republican and Democrat alike. While it remains questionable that China will enforce all the new trade rules, especially if they stand in opposition to the government’s domestic economic development plan, Phase One will define the path the two nations walk going forward in 2020. For the first time there is a new law creating a domestic mechanism in China that can be used by aggrieved parties to demand a fairer playing field when it comes to the theft of intellectual property (IP).

According to the Agreement China must create a public action plan to explain how it will implement enforcement of IP rights and obligations. The requirement that China publish this enforcement data will, at a minimum, provide a more accurate method for Washington to gauge China’s progress. This was lacking in previous negotiations. In return the US has agreed only to reduce a portion of the tariffs on $360 billion in Chinese imports in the eight-chapter agreement.

President Xi Jinping now faces a robust series of provisions in the agreement related to technology transfer and intellectual property theft designed to shed light on China’s unfair trade practices. At issue for the United States is whether or not Xi will take the pragmatic steps required to implement those provisions. On the other hand, the Trump Administration is not facing any new Chinese demands on technology transfer or IP protections – with well-deserved credit going to USTR Lighthizer who negotiated Washington’s core grievance well.

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A less noticed but significant provision in the Agreement is the establishment of a Bilateral Evaluation and Dispute Resolution Office. This mechanism provides a tiered and straight-forward system headed by the USTR and a Chinese vice premier. Below them are designated positions to handle day-to-day issues and the appeals process. If no resolution can be reached there is a process in place that parties may use to escalate the complaint. In the past, US companies bristled at exposing their firms to the public scrutiny of making such a complaint. Whether the Office is a success may depend on American’s firms’ willingness to use it.

Remedial measures, according to the Agreement, are to be proportionate and not retaliatory with the goal of creating and maintaining a normal trading relationship. If the other side does not agree, the only possible recourse is to withdraw from the agreement with a 60-day written notice, an action China is not likely to take over a single issue. Talks on Phase 2 of the trade deal are likely to begin soon but not conclude until after the US Presidential this fall.

At home President Xi faces a myriad of issues related to the US economic sanctions, including a cooling domestic economy with growth slowing to levels below the required 6.2% required to achieve the country’s 10-year economic plan goal. If China’s top policymakers cannot find ways to curtail the slowdown and maintain growth there may be increased instability in the Chinese economy. This is on top of other domestic issues Xi must deal with such as the unrest in Hong Kong and the Uighur minority in western China.

Photo: Chinese government official site

Quick Analysis

Putin’s Saber Rattling

Earlier this week, President Biden reversed his 2022 decision, authorizing the provision of antipersonnel land mines to the Ukrainian government. It follows an earlier Administration authorization to allow the use of an advanced American missile system capable of striking as deep as 100 miles inside Russian territory. The US election season may be ending, but both Russia and the West show no indication of stepping down the conflict. Russian propaganda continues to swell as the Kremlin increases its threats to use nuclear weapons against the West. Last week Andrey Sushentsov, program director of the pro-Kremlin think tank Valdai Discussion Club (VDC), published an article on growing nuclear tensions in the region. Official Russian language in the last few years has been threatening. Since the US election, rhetoric like that in the Sushentsov article, has approached the level of nuclear blackmail. The VDC article’s main theme centers on Russia’s intent to directly confront the West militarily if the North Atlantic Treaty Organization (NATO) becomes involved in Russia’s conflict with Ukraine. “On the one hand, these threats are intended to frighten the West, but on the other, Russian propagandists themselves are starting to believe in the inevitability of escalation,” according to Ksenia Kirillova of the Jamestown Foundation. On November 11, Sushentsov wrote that “The conflict will reach a completely new level, with unpredictable consequences for Europe and the entire world.” Kirillova points out that Putin’s distorted image of the world is divorced from reality and is causing the Kremlin to issue demands that are impossible to fulfill. Financial and other Russian resources needed to support Putin’s war are growing scarcer at the same time. This week the Kremlin announced a reduction of payments to its soldiers. Recently North Korea acknowledged it was sending soldiers to fight in Ukraine as Putin is running out of bodies to use as cannon fire. The war is not going well for Russia. One question floating around the Washington intelligence community is whether Putin will act out of desperation before President-elect Trump assumes office. In recent months the Russian propaganda machine is spewing out materials from fairly reputable analytical platforms inside the country. Kirillova says that “Kremlin ‘experts’ do not conceal that such threats are only intended to break the West psychologically, as they themselves are not prepared for full-scale nuclear war.” Despite Russia’s lack of preparation for an all-out war with the West, the expanding nuclear rhetoric carries with it an increase in the threat of a full-scale war in multiple theaters of operation. In June 2023 a founder of the Russian Council on Foreign and Defense Policy, Sergey Karaganov, called for “delivering a pre-emptive strike of retaliation” on Poland to force the West to surrender. In the previous month, Dmitry Suslov, a direct of research programs at the policy center proposed organizing “a demonstration nuclear explosion” aimed at intimidating the West. In September, President Putin announced a reappraisal of Russian nuclear doctrine after speaking earlier in the year at the plenary session of the St. Petersburg International Economic Forum and jokingly calling Suslov a “scary person.” Pavel Baev, writing in the European Daily Monitor, says “Putin intends his announcement to mark an escalation of nuclear brinkmanship and influence the proceedings of future Ukrainian peace efforts.” Putin is expanding the list of environmental conditions that are acceptable for using a nuclear weapon and incorporating it into Russian military doctrine. Baev adds that “The ups and downs of Russian brinkmanship are disconnected from the kinetic battles of the war, correlating instead with Ukrainian peace offensives, such as Ukrainian President Volodymyr Zelenskyy’s first peace summit in Bürgenstock, Switzerland.” Despite the increase in vitriolic language, in a You Tube video published a week before the US presidential election, Karaganov openly assured the West the primary goal of the escalation is to break the American spirit and that of the West, not outright nuclear war. By Election Day in the US, with political prognosticators predicting a win for former president Trump, Karaganov changed his tune and called for an increased role in nuclear deterrence. Kirillova points out that Western concessions to Russia are unlikely to reduce the risk of nuclear escalation. The distorted reality inside the Kremlin continues to push that President-elect Trump is an adherent of “world government,” that Ukraine will create a nuclear weapon, and Russia must prepare for a nuclear conflagration to achieve its ambitions for a new world order. President-elect Trump has indicated he will not agree to concessions that destabilize Europe, the Middle East or other regions. Going forward a strong US foreign policy may be the most stabilizing course the West can count on to restrain Putin and his intent to rebuild the Russian empire. Daria Novak served in the U.S. State Dept. Illustration: Pixabay

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