Dialogue

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Evaluating and Improving U.S.-China Dialogues for Governmental and Nongovernmental Actors

By Daniel Jasper

1-19-2021

Delivering remarks to the U.S.-China Business Council in December 2020, China’s Foreign Minister Wang Yi offered five suggestions to reset U.S.-China relations for the incoming Biden administration. Among these recommendations, Wang proposed that the U.S. and China foster “correct strategic understanding” and strengthen communication and dialogue.[1]  Wang’s proposition to strengthen communication and dialogue may be a particularly tough sell to many in Washington who point to the

Daniel Jasper is AFSC’s Public Education and Advocacy Coordinator for Asia. His role is to bring lessons learned from AFSC’s programs throughout Asia back to policymakers in Washington. His current work focuses heavily on humanitarian, peacebuilding, and people-to-people relations.

current low point in relations after decades of dialogue as evidence that these exchanges aren’t producing the outcomes the relationship needs. Many cite Beijing’s promised commitments to market reforms that have yet to materialize to show that these dialogues have yielded little substantive change. Furthermore, the notion that dialogue has produced scant results has also supported claims that the U.S. should decouple from China, or that decoupling has accelerated because of unproductive dialogue. As a result, enthusiasm for dialogue has waned considerably in Washington during the the presidential administration of Donald Trump.

Joint statements, records, speeches, commitments, and goal announcements between the U.S. and China, however, paint a more complete picture of what bilateral dialogues have been able to achieve. Over recent decades, quantitative and qualitative evidence indicates that dialogues have produced significant contributions to global health, security, environmental management, and many other fields. The question then becomes: Why is dialogue treated as a failure by Washington? The metrics of success for these exchanges are, at least in part, responsible for some fundamental and persistent misunderstandings. Often, dialogue is judged as a whole and with broad statements about its ability to advance unilateral foreign policy ideals rather than how well they achieve jointly agreed-upon objectives. Commentary and assessments of these exchanges, then, urgently need more standardized and objective methods of evaluation.

As the U.S. and China approach a new juncture in the bilateral relationship, it’s imperative that the two countries accurately assess the contributions of bilateral dialogue as a foreign policy tool. To do so will require clarifying what is meant by “dialogue” and examining the past commitments and results of these exchanges. Given the importance of the U.S.-China relationship for both countries and the world at large, understanding dialogue as a policy instrument is a critical matter of global security. Has dialogue truly failed to produce tangible results? What have been the goals and outcomes of dialogues in the past? What commitments were made and how did each country follow through? How are we measuring the success or failures of these exchanges? Have we calibrated our expectations appropriately? These are the types of questions we will need to address with data-driven and historically accurate answers (as opposed to prevailing perceptions and generalized geopolitical anxiety) to truly understand what the role of dialogue is in the U.S.-China relationship.

Defining ‘Dialogue’

Dialogue as a concept has become a catch-all term, often employed to refer generally to the act of talking to the other side. Consequently, dialogue is often conflated with communication, negotiations, or engagement. At other times, the word is used synonymously with diplomacy as a whole. To assess the contributions of dialogue to U.S.-China relations, conceptual precision in both theory and in practice is necessary. While the meaning of “dialogue” is at times dependent on context, the term does have a (more or less) specific meaning in international relations.

Dialogues in bilateral or multilateral settings refer to a specific type of exchange in which delegations from two or more parties meet for a series of presentations and discussions on a given topic. In practice, these exchanges follow a rough format at three different levels: government to government (Track I), civil society to civil society (Track II), or a mixture of government and nongovernmental parties (Track 1.5). A typical dialogue lasts two or three days and consists of three or four discussion periods. Each discussion period focuses on a specific subtopic of a larger theme and lasts one and a half to two hours. Delegations usually consist of about 10 to 25 participants (for a total of 20 to 50 participants), who then give presentations on their areas of expertise. Each presentation can last from just five to 15 minutes followed by a discussion period after all the presentations are complete. Most often, the agenda will also include time for more informal interactions, such as eating meals together or even sightseeing as a group.

The intention behind these conference-style exchanges is to provide a private space to clear up misunderstandings, identify opportunities for cooperation, manage long-term relations, improve conflict resolution, and build strong professional and personal relationships among the participants. These goals are much easier to achieve in closed-door settings where participants can talk openly without political pressures or the fear of being misinterpreted by the press. Ideally, participants take what they learn about the other side’s perspective and incorporate that into policymaking and analysis. Dialogues can also serve as useful precursors or complements to negotiations by providing a space to explain system differences, outline constraints, and explore potential outcomes to proposed or ongoing negotiations.

In summary, the term “dialogue” denotes an extended meeting between counterparts; it is not the same as communication, engagement, negotiations, or diplomacy. It is a specific diplomatic tool — perhaps best categorized as a type of international exchange — with certain applications and foreseeable limitations. This more precise understanding of the term gives perspective to what outcomes might be possible with dialogues and under what circumstances they can best be utilized.

U.S.-China Dialogues

In the case of the U.S.-China relationship, dialogues have roots in engagements extending back to the 1970s. For example, the U.S.-China Joint Economic Committee (JEC) was created by President Jimmy Carter and Deng Xiaoping in January 1979 to begin economic normalization.[1] In recent years, the scale of these exchanges has oscillated between extensive, including a vast array of government agencies and civil society actors, to minimal, essentially as interactions between only essential points of governmental contact, such as the military, and peripheral exchanges among civil society organizations. Topics of dialogue have expanded over the years along with China’s growing influence and have included diverse issues such as trade, global conflicts like those in Sudan and North Korea, cybersecurity, environmental protections, border controls, drug trafficking, aviation, tourism, food safety standards, humanitarian operations, and infectious diseases. To understand the scale and results of U.S.-China dialogue over the years, the following sections provide an overview of the recent history.

George W. Bush Expands Dialogues

Dialogue structures between the U.S. and China under the George W. Bush administration were refashioned to include two components – the Senior Dialogue (SD) and the Strategic Economic Dialogue (SED). At a press briefing following the first SD in 2005, then Deputy Secretary of State Robert Zoellick stated,

“The purpose of the dialogue is to discuss the strategic and conceptual framework for our relations. And in doing so, to move beyond the operational day-to-day work that we – both countries – are regularly engaged in and to try to integrate across issues so that we can better understand one another’s respective interests, but also domestic considerations.”[2]

At the outset, these dialogues were intended to provide context to everyday diplomacy by allowing the U.S. and China to clarify intentions and perspectives on global affairs. Similarly, the Treasury Department described the purpose of the SED as follows:

“By prioritizing issues in the broader context of our bilateral economic relationship, the SED gives direction and creates momentum for the many existing bilateral mechanisms we use to foster cooperation and resolve concerns across the spectrum of economic issues.”[3]

While these broadly worded purpose statements did not include any easily measurable goals, the SD and SED dialogues did result in significant coordination and tangible results in U.S.-China relations, as well as in important reforms to each country’s domestic policies. A small sampling of outcomes provides insight into the spectrum of early achievements. Successful outcomes included:

> Air services liberalization, which allowed for the doubling of daily passenger flights and gave “unfettered access to Chinese markets by lifting all government-set limits on the number of cargo flights and cargo carriers serving the two countries….”[4] [5]

> Tourism promotion by agreeing to allow group Chinese tourist travel to the U.S. This agreement later allowed for a more than an 80% increase in Chinese tourism to the U.S. in the years that followed.[6] [7]

> Agreement to allow foreign banks in China to offer a range of RMB (renminbi, or currency) services and compete with Chinese banks. U.S. and other foreign banks were granted access in 2007 after the agreement.[8]

> Cooperation around export safety and environmental controls on a range of consumer goods such as food, pharmaceuticals, medical products, alcohol, tobacco, electrical products, pesticides, fireworks, and motor vehicles.[9]

> Cooperation on scientific standard setting such as in metrology which facilitated trade and improved product quality.[10]

Crucially, the SED provided an important touch point in 2007 when China was hit by economic turbulence due to its exposure to the U.S. and global subprime lending markets.[11] When the economic crisis reached global proportions in 2008, the SED provided a readymade venue to discuss a full suite of issues amidst the “global economic and financial stress.”[12]  At these dialogues, both countries charted the course for complementary economic policies and agreed to stimulus packages that helped strengthen recovery efforts worldwide.[13]

Obama Expands Dialogues

Under President Barack Obama, the U.S.-China dialogue structure was redefined as the Strategic and Economic Dialogue (S&ED). The new framework separated into two tracks: a strategic track (which encompassed an array of security issues including military-to-military relations, international conflicts, environmental management, and transportation) and an economic track (which encompassed the full spectrum of trade and commerce issues). The frameworks served as an umbrella to a wide network of sub-dialogues, institutional partnerships, and coordination at the local governmental level. At the S&ED’s inception, the Treasury Department issued a fact sheet which described the goal of the forum as follows:

“Both President Obama and President Hu Jintao of China have placed the S&ED at the center of our bilateral relationship and are committed to delivering concrete, meaningful and sustained progress over time on long‐term strategic and economic objectives through the S&ED.”[14]

Like the structure preceding it, the S&ED’s stated goals were open-ended and, consequently, difficult to measure. Nonetheless, available quantitative data does show that the S&ED saw increased progress on foreign policy objectives and outcomes along both tracks. As depicted in Figure 1, for instance, reported outcomes from the strategic track rose from just 26 in 2010 to 120 by the end of the dialogues in 2016.[15] While these outcomes do not necessarily equate to “concrete, meaningful” progress, the notable increase does reflect growing space for institutional cooperation and/or an increase in the number of issues addressed on a bilateral basis. 

While many of the results from the S&ED are difficult to measure in terms of their on-the-ground impact, a large portion of the outcomes were substantive contributions to global security and economic growth. It’s worth briefly exploring a sample of the dialogues’ successful products to gain a clearer understanding of what these mechanisms can accomplish.

Trump and the Collapse of Dialogue

Initially, the S&ED was refashioned under the Trump administration into the all-encompassing Comprehensive Dialogue (CD), which was separated into four pillars: 1) the Diplomatic and Security Dialogue, 2) the Comprehensive Economic Dialogue, 3) the Law Enforcement and Cybersecurity Dialogue, and 4) the Social and Cultural Issues Dialogue.[38] However, the framework largely fell apart as a result of the increased frictions from the trade war and decreased interest in traditional modes of diplomacy under the Trump administration. By the end of 2020, only a few channels remained open for issues such as trade and military-to-military contacts. Halting the dialogue process set back many of the gains that had been achieved over the prior decade, contributed to an overall decline in the relationship, allowed irritants to go unaddressed, and has made cooperation more difficult to restart.

Far from being a way for China to string along the U.S. while making no real concessions as some have argued, the above review of successes indicates that the exchanges brought about some important improvements in security and the global economy. In some cases, the dialogues gave high-level direction to existing institutional cooperation and helped agencies “stay ahead of the game” by providing a space to collaborate on emerging issues. For example, outcomes of the S&ED during the Obama years began providing senior level input on cooperation between U.S. and Chinese law enforcement agencies at least four years before the rise of the opioid crisis.[39] [40] Similarly, the bilateral dialogues helped create space for health experts from each country to begin cooperating on infectious diseases 16 years before the COVID-19 pandemic.[41] These gains in global health cooperation were later rolled back by the Trump administration before and during the pandemic, slowing the initial response to the virus and demonstrating the dangers inherent in a decoupling strategy.[42]

The Role of Track IIs and Civil Society

Since the opening of relations between the U.S. and China with the famous “ping pong diplomacy” of the 1970s, the space for civil society exchanges has expanded greatly. These early exchanges helped set the stage for the now ubiquitous Track II dialogues (exchanges between civil society and other nongovernmental parties), which have served a critical role in mediation, trust building, and “back channel” communication. Crucially, Track II dialogues have also served as important telegraphing instruments during moments of crisis, when Track I channels are usually stretched thin or closed off.

For instance, in the midst of the 2008 financial crisis, the U.S. Chamber of Commerce and the China Center for International Economic Exchanges formulated plans to launch the U.S.-China CEO dialogue. The dialogue was launched in 2011 and has since provided a unique space for business leaders to discuss topics of concern at important junctures in the economic relationship. For instance, the dialogue allowed the business community to come together as Xi Jinping’s new government prepared to meet with the Obama administration for the first time in 2013, as well as during critical trade negotiations during the Trump administration. Relatedly, former US Secretary of Commerce Carlos Gutierrez has stated, “As an important window for both China and the US, the Track Two economic and trade dialogue mechanism has ushered in a new chapter in bilateral ties, and has also deepened my understanding of China.”[43]

Track II dialogues have made important contributions in myriad other issue areas as well, such as health, human rights, development, peacekeeping, environmental management, and security. Like Track I talks, the results tend to accumulate over long periods of time. In a review of the lessons learned from civil society dialogues in the nuclear security realm, the Institute for Defense Analysis (IDA) stressed the need to view Track 1.5 and Track II dialogues as long-term investments in security. Their conclusions are worth quoting at length.

“While the value of United States-Chinese Track 1.5/2 discussions on security issues develop only with time and engagement, they are constructive endeavors that should be championed and continued with increased attention. Track 1.5/2 meetings with the Chinese serve many purposes, one of which is to refine understanding over time of China’s nuclear forces and ambitions. They also produce common lexicons, allow each side to explain its anxieties about the other’s positions and behavior, identify and attempt to mitigate misperceptions, keep talks going on sensitive subjects in unofficial channels when they are frozen at the official level, provide a venue to float trial balloons and seek ways to build confidence, and provide useful experience for future generations of analysts and officials.

They also may foster relations (and perhaps even a degree of trust) among participants who return to Track 1.5/2 meetings, although maintaining long-term and continuing professional relations with one’s foreign counterparts while remaining compliant with counterintelligence and export control rules and regulations can be difficult for participants on both sides.”[44]

These conclusions highlight the value of Track II dialogue broadly and call attention to the limitations of civil society engagement on sensitive issues. On the other hand, these exchanges can also be useful for sensitive subjects as nongovernmental participants may be less constrained in their talking points than governmental officials. IDA’s analysis above is verified by the detailed documentation of these dialogues provided by the Naval Postgraduate School. In its 2016 narrative accompanying the Track 1.5 and Track II dialogues on nuclear issues, the authors noted that the Chinese participants became more willing than in prior years to discuss issues such as strategic stability (as traditionally understood by Western experts).[45] This change in understanding by the Chinese side was reported after eight previously documented dialogues — highlighting the need to evaluate results on a long-term, historical basis.

The outcomes of these dialogues, while substantial, are much more difficult to evaluate than their Track I counterparts. Firstly, the vast number and great variety of actors and institutions participating in U.S.-China Track IIs make comprehensive evaluations nearly impossible. Secondly, measuring results can be difficult as Track II dialogues tend to lack goal or purpose statements, instead opting for descriptions of the events or thematic foci. Thirdly, even in well-documented Track II sessions, results of dialogue can be difficult to ascertain: How is one to know that a concept was developed initially and exclusively at one particular dialogue? How can civil society actors prove that the concepts developed were successfully incorporated into policy? At times, civil society actors may be caught between the desire to document outcomes (especially for donors) and the need to maintain confidentiality with policymakers. Rarely are successful transfers between Track II and Track I dialogues acknowledged by officials, and civil society actors may want to cede credit for their proposals in favor of policy or political progress.

Despite these challenges in evaluating Track II dialogues, both sides have, at one point or another, acknowledged the important role civil society actors play. Given the increasing complexity of the U.S.-China relationship and its rising political difficulties, Track II dialogues will continue to be an important channel for experts to improve communication, develop concrete policy proposals, and gain more nuanced pictures of one another. Ideally, these benefits are not only transferred to policymakers but also to the public as Track II participants incorporate their learnings into public communications, which can have an immense bearing on media narratives and public perceptions.

Criticism of U.S.-China Dialogues

Understanding the major criticisms of dialogue is also necessary to improve how the tool is employed in the relationship and how to overcome consistent challenges. Perhaps most crucially, addressing these issues will also help policymakers and dialogue participants set expectations appropriately for these exchanges.

Lack of Follow Through

Critics rightly point out that many commitments made during dialogues were not upheld. Many point to China’s continued lack of intellectual property protections as a prime example of the limitations of these exchanges. At least as far back as 2007, China committed to protecting IP rights and did follow through on a number of key reforms, including the establishment of specialized IP courts and revisions to domestic law. However, 1 in 5 North-American corporations reported IP theft in 2019, and, according to a CNBC Global CFO Council survey, seven out of 23 companies reported IP theft in the past decade.[46] Others have pointed out that the piecemeal reforms are not enough to address the issue, as IP protections would require “a complete structural overhaul” of Beijing’s legal system.[47] Other commitments have achieved considerable follow through, only to later be seen as problematic, ineffectual, or surface level adjustments with little practical impact. For example, the two sides agreed to a pilot auditing program in 2013.[48] The program was heralded as a big step forward in cooperation as it allowed US watchdogs to obtain documents in enforcement cases against Chinese auditors. The watchdog organization (the Public Company Accounting Oversight Board), however, often complained about China’s failure to grant requests; China often cited national security laws as prohibiting access to books and records.[49] As a result, the Trump administration threatened to scrap the deal in 2020 while China countered with a proposal for a new arrangement with U.S. regulators.[50] [51] The program shows how mercurial these commitments can be and how long it can take to truly ascertain the success and durability of any agreement.

Structural mismatches

The vast differences between the U.S. and Chinese governing systems also present an enormous obstacle to successful dialogue. On one hand, commitments made by U.S. administrations that were later overturned by subsequent administrations show the difficulty in dealing with democratic states. Since at least 2007, for example, the U.S. and China made repeated commitments to oppose “trade and investment protectionism.”[52] These prior commitments were not upheld by the Trump administration which launched a trade war with China and cut many existing channels of dialogue.

On the other hand, China’s top-down system of governance presents difficulties with implementing many of the reforms U.S. lawmakers and constituents would like to see (as in the case of IP reforms mentioned above). The hierarchical structure stands in contrast to the bottom-up approach of the U.S. governance model where working level officials flesh out policies, which are then brought to more senior officials for refinement and decision-making. Traditionally, Chinese leaders provide broad directives to lower levels of government, meaning that Chinese working level officials (who may be awaiting direction from the higher levels) are not in the same position as their U.S. counterparts (who are seeking substance to present to their superiors) in many of these dialogues.

Empty promises

Broader criticisms have been leveled against dialogue as well. Some argue that the engagements (especially during the Obama years) did not yield the results the relationship truly needed (or that American foreign policy ideals demanded); thus, these critics argued that China was gaining legitimacy from the talks and could make low-cost commitments with no intentions of enforcing them. Some took the argument further, accusing China of stringing U.S. lawmakers along while advancing its own interests domestically and internationally. However, as we saw in the above review of outcomes, these exchanges provided important spaces to improve understanding and advance significant cooperation.

Recommendations for Future U.S.-China Dialogues

Setting Goals and Measuring Progress

To find stability in the bilateral relationship, both sides will need to employ a variety of diplomatic tools, including dialogue. However, it is imperative that dialogue be understood for what it is: a policy intervention; it is not a “gift to the enemy” but a necessary, low-cost, productive yet limited mode of maintaining peace and security. Dialogue, as we have seen, does have concrete or even quantifiable results; it is a diplomatic instrument that can be evaluated by examining reported outcomes with real-world developments. As with any policy intervention, proper assessment requires that dialogues have clear, measurable goals from the beginning and enough historical data to evaluate results. Therefore, future assessments about what dialogue has or has not been able to achieve should include evidence and data to support the claim so that policymakers can adjust where necessary.

Designing and including measurable goals for dialogues should not be an overly constrictive or unnecessarily exacting process. Dialogues, after all, should be a way to explore new territory in the relationship and the exchanges should not suffer from arbitrary pressure (internal or external) to demonstrate quantitative progress. At the same time, participants can hold themselves accountable with an outline of cooperation and a general sense of how to direct the exchanges. Below are some primary examples of points to include in purpose or goal statements to help make evaluation easier.

> How often the dialogues are intended to happen.

> How many participants are intended to be included.

> The estimated timeline for any outputs or outcomes.

> Intended changes in the scale of cooperation or conflict in the relationship as a result of the dialogue. For example, a goal statement could include aims to “increase traditional security cooperation,” “increase environmental cooperation,” or “decrease incidents of conflict.” The specificity of each goal will likely correspond to the level of dialogue and may necessarily become more specific at working levels.

Given that the effects of dialogues can take many years to fully manifest and the developments may go through periods of rapid progress, inaction, and even regression, assessments should be mainly understood as a momentary snapshot of a dialogue’s results and not necessarily a final evaluation. Dialogues can only be assessed after an appropriate period of time has passed in order to identify whether any necessary knowledge transfers, policy changes, and shifts in practice have truly taken place. The true outcomes of a dialogue or series of dialogues may not be visible for a year, a decade, or even longer in some cases. As such, only in recent years has enough data become available to truly begin evaluating the performance of U.S.-China Track I dialogues. The long-term nature of these instruments means that they must be evaluated on a historical (or longitudinal) basis, and, going forward, it remains essential that dialogues be framed as a long-term investment in security.

As we sharpen our understanding of the role of dialogue, it will be necessary to use a more standardized and exacting vocabulary as well. While this report does not seek to put forward a definitive lexicon for future dialogue, it is necessary to draw attention to a critical distinction in two developments that follow the conclusion of a dialogue. The first development after a dialogue is any commitments, agreements, or direction-setting statements that immediately follow an exchange; for illustrative purposes, we’ll call these “outputs.” The second development after a dialogue is the implementation of those outputs in the form of changes in policy and practice; we’ll dub these “outcomes.” This distinction is not only integral to evaluations of dialogue, but it also prevents a “fudging of the numbers” as it requires analysts to appropriately qualify their commentary on the results of these exchanges and help set expectations accordingly.

Tempering Expectations

Setting expectations is another challenge and requires considerable attention during the drafting of goal statements and descriptions of the dialogues. As stated above, goals should be clear, even if broad, and should be repeated as often as possible in public communications in order to set appropriate benchmarks by which policymakers and independent experts can evaluate the events over the long term. At the same time, the purpose of dialogue — a singular diplomatic tool — should be distinguished from unilateral foreign policy objectives in the same way that the purpose of a hammer (to drive a nail) is distinct from the goal of the foreman (to construct a building).

Independent experts and the media, for their part, have a responsibility to strive for accuracy in their depiction of these exchanges. For example, prior to the Trump administration, dialogues had often been characterized with words like “sprawling,” giving the impression that these exchanges were unwieldy and disorganized. Yet, while the multitude of institutional partnerships involved may have functioned to varying ways, these dialogues appear to have been well-coordinated, generating important and long-lasting cooperative efforts in areas as diverse as global health, nuclear security, drug trafficking, and environmental management. The widespread nature of these dialogues, then, does not necessarily indicate dishevelment, lack of coordination, or some irrational sprint toward embrace. The number of issues the U.S. and China must face is too large to be confined to a limited number of channels. Therefore, at least, moderately sized dialogue structures should be expected and welcomed as they are more likely to produce substantive outcomes.

Norm Setting and Long-term Investments in Dialogue

Dialogues have proved effective spaces for parties to manage relationships, avoid miscalculation and misperception, manage crises, send and receive signals, and discover areas of meaningful cooperation throughout the world. In the case of the U.S.-China relationship, however, dialogues carry an extra layer of significance and serve as important norm setting events. Given the importance of and inherent tensions in the bilateral relationship, U.S.-China dialogues set important examples for world leaders by demonstrating that disputes can and should be resolved through diplomatic means. These dialogues also send an important signal to the world that both countries are committed to peaceful management of the relationship and global affairs. While some have criticized high-level dialogues as performative, with each side repeating the same talking points, it raises the question of why each side feels the need to repeat themselves and whether or not these points are truly being heard and effectively incorporated in decision-making processes. In other words, repetition does not necessarily indicate that dialogue is ineffective; it may indicate a larger challenge in understanding (which is not the same as endorsing) the other party’s world view and “strategic and moral universe.”[53] These exchanges, then, should be understood as valuable information gathering, signal sending, and norm-setting events with long-term payoffs — even when the immediate outputs feel thin.

Diversity and Inclusion

Another essential dimension of dialogues is the issue of who is at the table. The need to ensure gender and minority representation in these settings, and in wider diplomatic engagements, is paramount to the success of individual dialogues as well as the larger state of relations between the U.S. and China. A steadily growing body of literature in recent decades has demonstrated that higher degrees of gender equality in a given society reduce the likelihood of conflict both domestically and internationally.[54] Research has also shown that when women are a part of peace processes, the peace agreements are more likely to remain in place and provisions are more likely to be implemented.[55] One study found that the inclusion of civil society and women’s groups made a peace agreement 64% less likely to fail.[56] Investigations into the correlation between women’s participation and peace agreements have also highlighted that women often have access to populations and settings that men do not; making their input invaluable in security settings.[57] While the U.S. and China are not in a peace process, dialogues are a means of peacebuilding and ensuring a stable relationship. There is no reason to expect that the inclusion of women and minorities in these dialogues would not have the same sorts of impacts as in formal peace negotiations.

Coordinating Among Stakeholders

Intragovernmental Coordination

The sheer volume of issues that must be addressed between the U.S. and China means that there are many institutional stakeholders who must be a part of (or, at minimum, be kept abreast of) the dialogue process. Many executive departments, agencies, bureaus, and offices have their own idiosyncratic worldview and approach the bilateral relationship differently. At times, these views can be conflictual and even undermine one another by sending contradictory messages or actively stymying cooperation in other spheres. For instance, in one of the most thoroughly documented series of Track 1.5 dialogues between the U.S. and China, the U.S. Naval Postgraduate School recounted in its 2016 report that,

“internal U.S. political divisions were seen to inhibit cooperation and complicate relations. The State Department was viewed by Chinese interlocutors as obstructionist on military-to-military relations. USPACOM’s and 7th Fleet’s perceptions of China were viewed as divergent and in conflict with the White House’s and OSD’s views. The delegation also noted   that Congress cancelled a visit by a U.S. aircraft carrier to China.”[58]

Interagency coordination, then, is critical to the success of dialogue. Additionally, “triangulating” the results of these conversations by intentionally working to maintain regular contact between the administration, Congress, civil society, the business community, and the media could help ensure stakeholder buy-in for outputs and help ensure each actor is working toward or, at least, not obstructing important outcomes between other actors.

Civil Society

Civil society organizations play a uniquely critical role in dialogues as they offer a backchannel where messages can be sent with a degree of separation — allowing actors to save face, shield themselves from potential political backlash, or test ideas with independent experts. In the case of the U.S.-China relationship, civil society organizations have played a historically critical role as they were instrumental in opening the diplomatic relationship. For example, the American Friends Service Committee, Bulletin of the Atomic Scientists, Chicago Council on Foreign Relations, Northwestern University, and the University of Chicago began initial dialogues on mainland China as early as 1966. These and similar efforts informed U.S. Congressional attitudes, legislation, and executive polices early in the detente.[59] These Track II dialogues have also proven effective at filling in gaps from Track I conversations, managing expectations, and serving as “transfer mechanisms,” by which ideas are generated in a nongovernmental setting and carried over to official policy via professional networks or public communications.[60]
The U.S.-China bilateral relationship can ill afford to lose the vast network of experienced professionals involved in Track II dialogues and, thus, officials must make every effort to ensure these exchanges are not obstructed by travel restrictions, unwelcoming or hostile remarks, or other official policies that inhibit people-to-people engagement. Further, officials should strive to harvest the outcomes of these dialogues in an objective manner and carefully guard against confirmation biases.

Third-party States and Actors

As U.S.-China relations continue to involve an increasing variety of issues, there is a corresponding increase in the number of third-party stakeholders who are affected by the bilateral relationship. In regions such as Southeast Asia, Africa, the Middle East, and even Latin America, American and Chinese influence is beginning to overlap or have already overlapped for some time. These third-party regional actors have much at stake in the U.S-China bilateral relationship and can sometimes be caught in the middle, often forced to “choose a side” when considering development or investment models. These actors cannot be viewed as mere proxies by which each country can advance its system or worldview; they must be considered independent agents and necessary voices at dialogues to ensure a well-rounded perspective of outputs and outcomes. Like the inclusion of women and minorities discussed above, including third-party stakeholders, such as representatives of the relevant third-party government bodies and civil society, will build more robust and peaceful cooperative arrangements.

Recommendations for Track II Dialogues

While many of the above recommendations apply to all tracks of dialogue, it’s necessary to highlight recommendations specific to Track IIs.

Evaluating Results

Track II dialogues are notoriously difficult to link to specific policy or practice outcomes, as noted above. While this is unlikely to change given that civil society actors must maintain confidentiality and are not often given attribution from public officials, Track II dialogues can help demonstrate outcomes more effectively by: 1) articulating clear purpose or goal statements; 2) providing, when possible, public and detailed readouts of the events, making sure to highlight any notable progressions in thinking or attitudes; and 3) seeking to evaluate, on a historical basis, outcomes that could be reasonably attributed to or correlated with developments at the dialogue.

Repository for Track II Documentation

Creating a repository for Track II documentation could prove to be a useful exercise for evaluating the long-term contributions of these dialogues. This repository could be maintained and housed by a coalition of civil society organizations from both countries. Collecting the various narratives, press statements, and other reports in one place would have several important benefits. First, it would provide fertile ground for officials and experts to review earlier progress, identify previous challenges, and guide new, non-dogmatic approaches to Track II dialogue. Such a clearinghouse would also help Track II participants ensure the discussion continues to move forward by examining progress across sectors and even borrowing on progress made at other venues. Lastly, these archives could be an invaluable source of data for academics and social scientists examining citizen diplomacy efforts.

Connecting Track II Actors

Like difficulties in inter-agency coordination among offices with distinct worldviews and objectives, Track II dialogues also have an extensive network of civil society actors operating with a wide range of agendas. Typically, Track II participants connect via their professional networks. Many experts circulate among the different dialogues, at times serving as coordinator or co-host and, at other times, serving as invited speakers. While these connections are highly effective, they tend to be issue-specific and/or clustered among politically aligned experts. Currently, there is no singular space for Track II participants of one side to regularly gather and share insights from their dialogues. For example, there is not a conference style annual meeting for American participants of Track II dialogues. Such a symposium could help cross-pollinate ideas among issue areas and experts.

Improving Transfer Mechanisms

Track II participants aspire to move the results of their dialogues to Track I settings. Doing so, however, can prove difficult and the results can be tricky to assess. Providing routinized mechanisms by which officials are given readouts from the dialogues could help ensure officials receive critical messages or signals. Consequently, Track II coordinators may want to establish relationships with relevant government officials and provide them with routine briefings from their dialogues. Ideally, these readouts would be given both in writing and verbally. For example, if a civil society organization hosts an annual dialogue on humanitarian cooperation, the organization could let relevant officials at the State Department, U.S. Agency for International Development, and Department of Defense know they will provide a brief memo recapping the event each year and will follow up with in-person or over-the-phone debriefs when possible. In this way, officials and relevant policymakers can come to expect regular input from civil society actors.

Conclusion

In 2009, at the outset of the S&ED, then Secretary of State Hillary Clinton and Secretary of the Treasury Timothy Geithner co-wrote an opinion piece in The Wall Street Journal. They stated, “Simply put, few global problems can be solved by the U.S. or China alone. And few can be solved without the U.S. and China together.”[61] That statement has only grown more true in the decade that followed, and it underscores the notion that the U.S. and China will need to cooperate on a host of issues — not just the convenient or urgent topics. Dialogue has been and will continue to be an indispensable tool to explore all aspects of the relationship.

The U.S., China, and the world are still reaping some of the rewards of past dialogues and, despite a decrease in enthusiasm for these exchanges and an increase in tension, temporary developments in the relationship should not be confused with final outcomes. Moreover, when the term “dialogue” is differentiated from engagement, negotiations, or diplomacy, we’re also able to gain a fuller appreciation for what has been accomplished by these often fast-paced conference-style exchanges. There should be no doubt that these events have made significant contributions to security and that the entire world benefits from continued dialogue between the U.S. and China. Therefore, all levels of dialogue including governmental and non-governmental participants, must begin to focus on how to improve these policy tools by setting clearer goals, following through on agreed-upon framework structures, and managing expectations appropriately.

[1] “U.S.-China Joint Economic Committee.” awarchive, May 8, 1986. http://digitalcollections.library.cmu.edu/awweb/awarchive?type=file&item=691166. 

[2] Robert Zoellick. U.S. Department of State. U.S. Department of State, August 5, 2005. https://2001-2009.state.gov/s/d/former/zoellick/rem/50498.htm. 

[3] U.S. Department of The Treasury – U.S.-China Strategic Economic Dialogue, March 9, 2009. https://web.archive.org/web/20090617100850/http://www.ustreas.gov/initiatives/us-china/. 

[4] U.S. Department of the Treasury. U.S. Department of State. U.S. Department of State, May 23, 2007. https://2001-2009.state.gov/p/eap/rls/fs2007/85426.htm. 

[5] Jiaoe Wang, Haoran Yang, and Han Wang., “The evolution of China’s international aviation markets from a policy perspective on air passenger flows,” Sustainability 11 No.13 (June 28, 2019): 3566.

[6] Ibid.

[7] Sarah Feldman and Felix Richter. “Infographic: Chinese-U.S. Tourism Flatlines.” Statista Infographics, May 29, 2019. https://www.statista.com/chart/18212/us-chinese-tourism/. 

[8] “Foreign Banks Have Landed in China, but the Local Competition May Prove Tougher than Expected.” Knowledge@Wharton, August 1, 2007. https://knowledge.wharton.upenn.edu/article/foreign-banks-have-landed-in-china-but-the-local-competition-may-prove-tougher-than-expected/. 

[9] “The Third U.S. – China Strategic Economic Dialogue December 12 – 13, 2007, Beijing Joint Fact Sheet,” U.S. Department of the Treasury, December 12, 2007. https://www.treasury.gov/press-center/press-releases/Pages/hp732.aspx. 

[10] “U.S. Fact Sheet: Fifth Cabinet-Level Meeting of the U.S.-China Strategic Economic Dialogue,” U.S. Department of the Treasury, December 8, 2008. https://www.treasury.gov/press-center/press-releases/Pages/hp1316.aspx. 

[11] “The Third U.S. – China Strategic Economic Dialogue December 12 – 13, 2007, Beijing Joint Fact Sheet,” U.S. Department of the Treasury, December 12, 2007. https://www.treasury.gov/press-center/press-releases/Pages/hp732.aspx. 

[12]  “U.S. Fact Sheet: Fifth Cabinet-Level Meeting of the U.S.-China Strategic Economic Dialogue,” U.S. Department of the Treasury, December 8, 2008. https://www.treasury.gov/press-center/press-releases/Pages/hp1316.aspx. 

[13] “Second Meeting of the U.S. –China Strategic & Economic Dialogue Joint U.S.-China Economic Track Fact Sheet,” U.S. Department of the Treasury, May 27, 2010. https://www.treasury.gov/press-center/press-releases/Pages/tg722.aspx. 

[14] “FACT SHEET: U.S.‐China Strategic and Economic Dialogue.” U.S. Department of the Treasury, n.d. https://www.treasury.gov/initiatives/Documents/SEDfactsheet09.pdf. 

[15] U.S. State Department readouts did not provide a numbered list of outcomes in 2012 and 2015 as in other years and instead provided a narrative of the outcomes. The U.S. Treasury Department issued narratives of the economic track outcomes every year.

[16] “U.S.-China Strategic and Economic Dialogue 2011 Outcomes of the Strategic Track.” U.S. Department of State, May 10, 2011. https://2009-2017.state.gov/r/pa/prs/ps/2011/05/162967.htm. 

[17] “U.S.-China Joint Fact Sheet Sixth Meeting of the Strategic and Economic Dialogue.” U.S. Embassy & Consulates in China, July 11, 2014. https://china.usembassy-china.org.cn/u-s-china-joint-fact-sheet-sixth-meeting-strategic-economic-dialogue/. 

[18] Global Business Policy Council (GBPC). “Read @Kearney: The Rise of China’s Middle-Class Consumer.” Kearney, n.d. https://www.jp.kearney.com/web/global-business-policy-council/article/?%2Fa%2Fthe-rise-of-china-s-middle-class-consumer-article. 

[19] Brian Riedi, “Coronavirus Budget Projections,” Manhatten Institute, April 29, 2020, https://www.manhattan-institute.org/coronavirus-cbo-budget-deficit-projection.

[20] “U.S. Strategic and Economic Dialogue 2010-2016, Outcomes of the Strategic Track,” Department of State.

[21] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” Department of the Treasury, June 25, 2015, https://www.treasury.gov/press-center/press-releases/Pages/jl0092.aspx.

[22] Takamoto Suzuki, “The Renminbi Exchange Rate Reform and Its Implications for Asian Markets,” China Quarterly of International Strategic Studies, no. 4 (2016): 485-506,  https://doi.org/10.1142/S2377740016500317.

[23] “U.S.-China Strategic and Economic Dialogue Outcomes of the Strategic Track,” U.S. Department of State, 2013, https://2009-2017.state.gov/r/pa/prs/ps/2013/07/211861.htm.

[24] “U.S.-China Strategic and Economic Dialogue Outcomes of the Strategic Track,” U.S. Embassy and Consulates in China, July 14, 2014, https://china.usembassy-china.org.cn/u-s-china-strategic-economic-dialogue-outcomes-strategic-track/.

[25] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” U.S. Department of State.

[26] “China: Drug Administration Law Revised,” Library of Congress, October 31, 2019, https://www.loc.gov/law/foreign-news/article/china-drug-administration-law-revised/.

[27] “U.S.-China Strategic and Economic Dialogue Outcomes of the Strategic Track,” U.S. Department of State.

[28] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” U.S. Department of State. 

[29]  “China’s Top Legislature to Review Documents Online,” China Daily, February 25, 2019, http://www.chinadaily.com.cn/a/201902/25/WS5c73845aa3106c65c34eb401.html.

[30] “U.S.-China Strategic and Economic Dialogue Outcomes of the Strategic Track,” U.S. Department of State.

[31] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” U.S. Department of State.

[32] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” Department of the Treasury.

[33] He Xiyue, Sang Tong, Zhou Erjie,“China Lifts Foreign Ownership Limits on Security, Fund Management Firms,” Xinhua News, April 1, 2020, http://www.xinhuanet.com/english/2020-04/01/c_138938273.htm.

[34] “2015 U.S.-China Strategic and Economic Dialogue Joint U.S.-China Fact Sheet –Economic Track,” U.S. Department of State.

[35] Miles Pomper, Ferenc Dalnoki-Veress, “The Little Known Success Story of U.S.-China Nuclear Security Cooperation,” Nuclear Threat Initiative, June 10, 2020, https://www.nti.org/analysis/articles/little-known-success-story-us-china-nuclear-security-cooperation/.

[36] “2016 U.S.-China Strategic and Economic Dialogue U.S. Fact Sheet – Economic Track,” U.S. Department of State, June 7, 2016, https://www.treasury.gov/press-center/press-releases/Pages/jl0485.aspx.

[37] “ANALYSIS: China’s Latest Energy Liberalization Policy Set to Break Oil and Gas Monopolies | S&P Global Platts,” June 6, 2019, https://www.spglobal.com/platts/en/market-insights/latest-news/natural-gas/060619-analysis-chinas-latest-energy-liberalization-policy-set-to-break-oil-and-gas-monopolies.

[38] “Statement from the Press Secretary on the United States-China Visit,” The White House, April 7, 2017, https://www.whitehouse.gov/briefings-statements/statement-press-secretary-united-states-china-visit/.

[39] “China, U.S. Attach Importance to First Strategic and Economic Dialogue,” Consulate General of The People’s Republic of China in Chicago, July 28, 2009, http://www.chinaconsulatechicago.org/eng/ywzn/sw/t575630.htm.

[40] “2018 3 Wave Lines Mortality.Png,” National Vital Statistics System Mortality File, March 2018, https://www.cdc.gov/drugoverdose/images/epidemic/2018-3-Wave-Lines-Mortality.png.

[41] “China, U.S. Start 1st Strategic Economic Dialogue,” Embassy of the People’s Republic of China in the United States of America, December 14, 2006, http://us.chineseembassy.org/eng/zmgx/1/t283593.htm.

[42] Marisa Taylor, “Exclusive: U.S. Slashed CDC Staff inside China Prior to Coronavirus Outbreak,” The Reuters, March 25, 2020, https://www.reuters.com/article/us-health-coronavirus-china-cdc-exclusiv/exclusive-u-s-slashed-cdc-staff-inside-china-prior-to-coronavirus-outbreak-idUSKBN21C3N5.

[43] Jiao Liu, “China-US Track Two Diplomacy Injecting Huge Positive Energy,” China Daily, November 7, 2018, https://www.chinadaily.com.cn/a/201811/07/WS5be2b56aa310eff303287359.html.

[44] Michael O. Wheeler, “Track 1.5/2 Security Dialogues with China: Nuclear Lessons Learned:” (Fort Belvoir, VA: Defense Technical Information Center, September 2014), https://doi.org/10.21236/ADA622481. 

[45] Christopher Twomey et al., “U.S.-China Strategic Dialogue, Phase IX Report,” December 2016, https://calhoun.nps.edu/handle/10945/51930.

[46] Eric Rosenbaum, “1 in 5 Corporations Say China Has Stolen Their IP within the Last Year: CNBC CFO Survey,” CNBC, March 1, 2019, https://www.cnbc.com/2019/02/28/1-in-5-companies-say-china-stole-their-ip-within-the-last-year-cnbc.html.

[47] Daniel Rechtschaffen, “How China’s Legal System Enables Intellectual Property Theft,” The Diplomat, November 11, 2020, https://thediplomat.com/2020/11/how-chinas-legal-system-enables-intellectual-property-theft/.

[48] “Joint U.S.-China Economic Track Fact Sheet of the Fifth Meeting of the U.S.-China Strategic and Economic Dialogue,” U.S. Department of The Treasury, July 12, 2013, https://www.treasury.gov/press-center/press-releases/Pages/jl2010.aspx.

[49] Jay Clayton, Wes Bricker, and William D. Duhnke III, “Statement on the Vital Role of Audit Quality and Regulatory Access to Audit and Other Information Internationally—Discussion of Current Information Access Challenges with Respect to U.S.-Listed Companies with Significant Operations in China,” U.S. Securities and Exchange Comission, December 7, 2018, https://www.sec.gov/news/public-statement/statement-vital-role-audit-quality-and-regulatory-access-audit-and-other.

[50] “‘Imminent’: Washington Set to Ditch US-China Auditing Deal,” Aljazeera, July 14, 2020, https://www.aljazeera.com/economy/2020/7/14/imminent-washington-set-to-ditch-us-china-auditing-deal.

[51] Aaron Nicodemus, “China Proposes Joint Audit to End Dispute with U.S. Regulators,” Compliance Week, August 28, 2020, https://www.complianceweek.com/accounting-and-auditing/china-proposes-joint-audit-to-end-dispute-with-us-regulators/29379.article.

[52] “The Third U.S. – China Strategic Economic Dialogue December 12 – 13, 2007, Beijing Joint Fact Sheet,” U.S. Department of The Treasury, December 13, 2007, https://www.treasury.gov/press-center/press-releases/Pages/hp732.aspx.

[53] This concept is expounded further in Lyn Boyd-Judson’s book Strategic Moral Diplomacy: Understanding the Enemy’s Moral Universe.

[54] Mary Caprioli, “Gender Equality and State Aggression: The Impact of Domestic Gender Equality on State First Use of Force,” International Interactions 29, no. 3 (October 18, 2010): 195–214, https://doi.org/10.1080/03050620304595.

[55] Jana Krause, Werner Krause, and Piia Bränfors, “Women’s Participation in Peace Negotiations and the Durability of Peace,” International Interactions 44, no. 6 (October 8, 2018): 985–1016, https://doi.org/10.1080/03050629.2018.1492386.

[56] Desirée Nilsson, “Anchoring the Peace: Civil Society Actors in Peace Accords and Durable Peace,” International Interactions 38, no. 2 (April 10, 2012): 243–66, https://doi.org/10.1080/03050629.2012.659139.

[57] Louise Olsson et al., “Operational Effectiveness and UN Resolution 1325 – Practices and Lessons from Afghanistan,” Swedish Defence Research Agency, May 2009, 152.

[58] Twomey et al., “U.S.-China Strategic Dialogue, Phase IX Report.”

[59] Jacqueline Bruzio, “Historical Survey of AFSC Efforts in China, 1917-2005” (Harvarford College Libraries, n.d.).

[60] Esra Cuhadar and Thania Paffenholz, “Transfer 2.0: Applying the Concept of Transfer from Track-Two Workshops to Inclusive Peace Negotiations,” International Studies Review 22, no. 3 (September 2020): 651–70, https://doi.org/10.1093/isr/viz031.

[61] Hillary Clinton and Timothy Geithner, “A New Strategic and Economic Dialogue with China,” Wall Street Journal, July 27, 2009, sec. Opinion, https://www.wsj.com/articles/SB10001424052970204886304574308753825396372.

Evaluating and Improving U.S.-China Dialogues for Governmental and Nongovernmental Actors

By Liu Ying

3-11-2021

During President Donald Trump’s term in office, China-U.S. relations deteriorated. In 2018, The Trump administration announced sweeping tariffs on Chinese imports, worth at least $50 billion. China also imposed retaliatory measures, and then the China-U.S. trade war started and escalated in the following years.[1] The two sides signed Phase One Economic and Trade Agreement (POETA) in 2020, and the trade war mitigated temporarily. The United States and China also had frequent conflicts in terms of democracy and human rights,[2] technological exchanges,[3] and personnel mobility[4] during the 

Liu Ying, doctor of law, is a professor and doctoral supervisor at Law School & Institute of International Law, Wuhan University. She is a senior research fellow at the Wuhan University Institute of International Law, a chief expert for Wuhan University Academy of International Law and Global Governance.

last few years. In July 2020, the two countries even closed each other’s consulates, and the conflict between the two countries further escalated.

Despite the growing tension between the two countries, the United States basically cut off bilateral dialogue at all levels. However, China-U.S. dialogue and cooperation is needed to fight COVID-19, tackle climate change, promote world economic recovery and address other global issues.[5] On Jan. 20, 2021, Joe Biden became president. It is imperative that he restart the dialogue between China and the United States. In addition, a normalized dialogue mechanism needs to be established, and the dialogue should be timely and frequent. The phone call between Chinese President Xi Jinping and Biden on Feb. 11, 2021, was a positive step in that direction.[6]

This report will focus on the following two topics:

> How to carry out the dialogue: China and the United States need to establish dialogue mechanisms at all levels, modeled on the historical dialogue mechanism.

> Specific content of the dialogue: The content of the dialogue must involve not only the bilateral concerns of China and the United States, but also global governance issues. Although the two countries have many differences and points of conflict, they also have common interests that should be discussed and pursued for their mutual benefit.

Dialogue Mechanisms

In the past couple of years, the official high-level dialogue between China and the United States has almost stopped, and the danger of miscalculation in China-US relations is heightened. Normally, differences can eventually be resolved through communication based on understanding the two sides’ common interests.[7]

The purpose of dialogue is to clarify facts, eliminate misunderstandings, avoid misjudgments, and curtail misinformation in order to maintain space for improvement of China-U.S. relations in the future.[8] If the dialogue is timely and effective, it may affect the Biden administration’s policy and attitude in certain areas. Only communication can dispel falsehoods, and only dialogue can prevent miscalculation. That is why it is necessary to make timely arrangements and adjustments to the dialogue content and strategies.

“China and the United States should re-establish various dialogue mechanisms, accurately understand each other’s policy intentions, and avoid misunderstanding and misjudgment,” Xi said during the Feb. 12 phone call with Biden.

Before the creation or re-establishment of any dialogue mechanism, three matters should be taken into consideration:

> When to have a dialogue: In theory, the dialogue between the two governments needs to be ongoing and uninterrupted. Nongovernmental organizations such as think tanks, trade associations, and businesses in both China and the United States can also engage in dialogue.

> Whom to talk to: The conversation should not be confined to China and the United States. In the future of global governance and international affairs, Western countries that share the same values as the United States should also be involved.

> How to have a dialogue: The main body of the dialogue should be broad, it could take a variety of forms, and the issues addressed should be comprehensive.

There are two principal approaches the nations could take:

On the one hand, China and the United States could restore previously established strategic high- level dialogue mechanisms and add others where needed.

The best-known mechanisms is the Strategic Economic Dialogue initiated by Presidents George W. Bush and Hu Jintao in 2006. A total of five meetings were held between 2006 and 2008. On April 1, 2009, Hu and President Barack Obama announced the establishment of the U.S.-China Strategic and Economic Dialogue (S&ED), replacing the SED. The Comprehensive Economic Dialogue (CED) was established by Trump and Xi in April 2017 to address and resolve many economic issues. This high-level bilateral economic forum was abandoned after Trump initiated a trade war with China.[9]

China and the United States also have dialogue through the Joint Commission on Commerce and Trade Meeting, and the Joint Commission on Science and Technology Cooperation Meeting.

Other dialogue mechanisms like the trade framework groups, macroeconomic meetings and the bilateral assessment and dispute resolution offices[10] should be maintained. To further improve the dispute settlement mechanism under POETA, China and the United States should allow disputes to be submitted to an expert group or an independent third party for adjudication.

On the other hand, China and the United States could make full use of dialogue platforms and channels established by civil society, including:

Think tanks and other nongovernmental organizations, which have high flexibility and can effectively communicate and convey intentions because of their unofficial nature and professionalism.

The China-U.S. Great Mekong Subregion (“GMS”) Cooperation Dialogue Forum established by Kunming South Asia and Southeast Asia International Logistics Research Institute and U.S. Stimson Center to discuss transportation and logistics, water resources development and international cooperation, energy and infrastructure projects, environmental protection, regional foreign policy and regional security, and other topics concerning international regional governance.

There should be more youth exchange mechanisms to inject vitality into China-U.S. relations. Young people, especially young leaders, should play more roles in China-U.S. exchanges.[11]

To sum up, by establishing a multilevel, point-to-point communication mechanism and making it the norm, the two countries can better reduce specific differences, achieve common goals, and avoid potential conflict.

Issues to Address through Dialogue

WTO Reform

The United States, Japan and the European Union have agreed on the need for World Trade Organization reform.[12] The Office of the U.S. Trade Representative has made it a major priority. China has always supported the role of the WTO in international trade and endorses necessary reforms to ensure the the WTO’s  survival.[13] However, the United States and other members have defined too many controversial issues as “China problems,” such as forced technology transfer, nonmarket economy practices, etc.

Recommendation:

> Starting from the common willingness to promote WTO reform, China may, through dialogue, suggest the United States distinguish between Chinese and non-Chinese factors and put forward corresponding solutions.[14] The discussion should prioritize non-Chinese issues through bilateral dialogue mechanisms, reconcile differences and divergences outside the WTO framework, and set aside matters with Chinese issues that are currently irreconcilable because of differences in economic models and values.

Digital Trade and E-Commerce

At the informal ministerial meeting on e-commerce on Jan. 25, 2019, 76 WTO members, including China and the United States, signed the Joint Statement on Electronic Commerce, confirming their intention to launch plurilateral negotiations on trade-related electronic commerce issues.[15] On April 24, China, the United States and eight other members, issued the first round of proposals through the WTO.[16] Seven rounds have been held since, and some consensus has been reached on improving the facilitation and transparency of e-commerce, protecting online consumers, and promoting the participation of small and medium-sized enterprises.[17] As large players in digital trade and e-commerce, China and the United States have some consensus on the protection of intellectual property rights and technological innovation, income distribution (collection of digital taxes), network security, and national security. But there are still differences on some specific issues such as the definition and scope of e-commerce[18] and the treatment of network equipment and products.[19]

Recommendation:

> In spite of some differences, both countries have incentive to make a new agreement, thus their consensus can serve as the basis for dialogue to bridge differences and to jointly promote a standardized, convenient, secure, and credible e-commerce trading and market environment.[20] China can respond positively to the expansion of digital trade and to strengthening the protection of intellectual property rights in digital trade.[21] The United States could partly respect China’s insistence on the nondiscriminatory treatment of Chinese enterprises and the development orientation.[22] Taking the protection of national security as the bottom line, the two countries may set national security exceptions while establishing a digital trade relief system with a high standard of rules.[23] 

The Coordination of Digital Tax

A report on a special investigation of trade barriers, issued in December 2019 by the Office of the U.S. Trade Representative, found that France’s taxation practices regarding digital services discriminated against American businesses[24] in violation of Articles 2 and 17 of the General Agreement on Trade in Services (GATS).[25] In the “Belt and Road Initiative” (BRI), Chinese digital enterprises also face the problem of collecting digital tax.[26] More and more countries with underdeveloped digital economies may levy digital service taxes on foreign digital enterprises, so China and the United States have broad consensus and interests in the international coordination of digital service taxes.

Recommendation:

> The two countries should actively participate in meetings and forums related to digital trade rule formulation under the United Nations, the Organization for Economic Co-operation and Development (OECD) and the WTO, oppose the abuse of digital taxes and the discriminatory imposition of unilateral digital tax measures, and safeguard the interests of consumers and digital enterprises.

Reforms that Dialogue Could Bring

WTO Reform

Special and Differential Treatment

Both the United States and China recognize that special and differential treatment (SDT) rules are no longer in line with current reality and SDT for underdeveloped members is an urgent problem that needs to be improved through negotiation. In the view of the United States, the applicable basis of SDT no longer exists.[27] The U.S. argues that China, India, and other advanced economies should follow the same rules that bind America, the European Union, and Japan.[28] Having made the definition of developing members and related SDT rules a key priority for WTO reform, the United States also proposed four criteria.[29] Furthermore, it suggested that SDT should not be applied automatically.[30] The U.S. proposal aroused strong opposition from developing members. China, India, South Africa, and other countries put forward counterproposals, suggesting that the North-South gap has not been substantially narrowed and developing members continue facing difficult development problems.[31] In China’s view, debate on the criteria for distinguishing developing members is meaningless, and WTO should continue to support the better integration of developing members into global value chains and continue to guarantee the SDT that developing members deserve.[32]

Recommendations:

> For the United States, developing member status is a political issue. If the United States wants to break through the current impasse, it needs to separate developing membership from SDT in future negotiations[33] and temporarily maintain the original “self-identification” approach. A proposal by members such as Norway suggested that reform should proceed in a direction that balances the rights and obligations of the 164 members with different levels of development.[34]

> For China, the separation of developing members from SDT would be more conducive to the current North-South conflicts easement within the WTO frame. On this basis, China can consider accepting reform proposals on adjusting the content and application of SDT, such as narrowing the scope of application of SDT, introducing a graduation mechanism.[35] After all, a clear definition of developing members is inevitable. While still insisting on developing member status and advocating SDT, China needs to respond to the concern of the United States and assume more international obligations in line with level of development.[36]

Notification and Transparency

It is of great importance to strengthen and enhance transparency and improve the operation and effectiveness of notification requirements, and all members should contribute to it. However, the United States proposed that punitive measures[37] should be imposed on members that fail to provide required notification on time,[38] and counternotification should be applied. China disagreed.

Recommendations:

> Formulate more specific rules for counternotification. What needs more attention is how to avoid the abuse of counternotification and improve the quality of notification. China and the United States should communicate to formulate more specific rules. For example, let prior communication, discussion, or attempts to resolve the matter bilaterally be the precondition of counter-notification;[39] require the member that conducts counternotification to provide sufficient and material evidence.[40]

> Abandon punishment mechanisms. It’s not feasible to formulate a new punishment mechanism due to the current overwhelming obstacles,[41] and no punishment mechanism can fundamentally solve the problems in the practice of transparency and notification. Therefore, it would be better for the United States to abandon its punishment mechanism proposal and work with China to seek more practical methods, such as procedures for bilateral or multilateral consultations and the review of declared measures after counternotification.

> Simplify procedures. Due to the complexity of current rules of notification, less stringent notification obligations and simplified procedures may improve the implementation of WTO notification obligations.[42] China and the United States should cooperate in this area.

> Establish a specific institution. The two countries could jointly propose to establish a working group on notification obligations and procedures responsible for managing transparency and notification affairs, as mentioned in the United States’ proposal.[43]

State-owned Enterprises

China and the United States both recognize the importance of a fair and free competitive environment. State-owned enterprises (SOEs) should participate in international trade on a commercial basis in conformity with the principle of nondiscrimination. The U.S. National Security Strategy Report, released in 2017, alleged SOEs obtained advantages through unfair trade. Since 2017, seven trilateral ministerial meetings driven by the United States have been held to reach a consensus on addressing other countries’ so-called market distortions, pointing directly to China and its SOEs. From the Trans-Pacific Partnership Agreement (TPP) to the U.S.-Mexico-Canada Agreement (USMCA), the United States tightens SOE rules and strengthens the discipline of SOEs at the international level. China believes that SOEs are commercial entities in essence. China cannot accept the establishment of additional rules for SOEs, nor should there be discrimination or additional restrictions based on ownership differences.[44] Subsidies on SOEs are another focus of the disputes between China and the United States.

Recommendations:

The conflict between China and the United States on the issue of SOEs cannot be reconciled, but in the context of WTO reform, it is necessary for the two to increase dialogue to prevent the whole process from being delayed by the differences on SOEs.

> The United States has the right to propose new rules for SOEs, but it needs to recognize that China is not the only WTO member with a large number of SOEs; it must take into account the interests of other relative members when making reform proposals. The United States could try to address some of its concerns through bilateral agreements with China.

> China should agree to negotiate the rules of SOEs under the WTO framework to make full use of its discourse power to avoid the unfavorable situation of passive acceptance. It also should consider adopting different negotiating positions in each specific area. China can commit to some obligations in line with its SOE reform goals step by step, such as “competitive neutrality.”[45] Meanwhile, China should advocate ownership neutrality and oppose tailoring a set of rules to restrict the development of SOEs.[46] A fairer allocation of subsidies rather than an allocation designed to favor SOEs is needed. China could distinguish SOEs whose main business involves essential national economy and people’s livelihood from those in the fully competitive industries and fields that should not be granted subsidies, while continuing its traditional measures and providing preferential policies to them.[47]

Subsidies

The rules of subsidy need to be clarified and improved, and all members need to gradually reduce subsidies. The United States attempted to expand the range of prohibited subsidies and actionable subsidies, while China argued that non-actionable subsidies should be reinstated and its coverage should be expanded. On overcapacity, the United States argued that China’s subsidies led to overcapacity and even distorted the market, which should be directly included in the scope of “Serious Prejudice” mentioned in Article 6.3 of the Agreement on Subsidies and Countervailing Measures (ASCM). However, in China’s view, the reasons for overcapacity were diverse, and it was wrong and one-sided to blame the overcapacity problem solely on subsidies.[48]

Recommendations:

> Each country should review its own subsidies and gradually eliminate those that are not in compliance with WTO rules. China needs to formulate more systematic subsidy regulations. In particular, China should improve the statistics and notifications of subsidies granted by sub-central entities since the insufficient notification of such subsidies has been strongly criticized by the United States. The United States has both incomplete and excessive notification.[49] Some subsidies in the United States still belong to actionable subsidies and may even fall into the scope of prohibited subsidies. Besides, the huge agricultural subsidies in the United States cause market distortions. The United States needs to adjust the scale and structure of its subsidies.[50]

> Focus on promoting subsidy reforms under WTO. China and the United States should focus on cooperating to promote subsidy reforms under the WTO, including establishing more detailed and specific subsidy rules, preventing abuse of trade remedy measures, and maintaining normal trade order.

National Security

National security exceptions are a necessary “safety valve” reserved in the WTO Agreements, and members’ right to resort to the exception should be respected. However, the United States has frequently sanctioned Chinese companies on the grounds of national security recently, seemingly in violation of WTO obligations. China called on the United States to act in good faith and exercise restraint in resorting to national security exceptions.[51] Besides, while China believed that the panel and appellate body had jurisdiction over such issues,[52] the United States opposed such jurisdiction.[53] China claimed the United States used national security provisions to undermine WTO rules.[54]

Recommendation:

> China should continue supporting the jurisdiction of of the Dispute Settlement Body (DSB) on national security exceptions and the principle of acting in good faith, and attempt to promote its views to be more widely recognized among members. The United States should apply national security exceptions prudently, especially when the measures it takes are not consistent with WTO Agreements. At any time, unilateralism and protectionism run counter to global cooperation. Dialogue is the best way to settle disputes. Even if it fails, the two countries should resolve their disputes through existing dispute resolution mechanisms such as the DSB rather than imposing unilateral sanctions.[55]

Market Economy

The United States demanded that the WTO formulate new rules with “like-minded” members to prevent economic distortions caused by China’s state capitalism, and continues to invoke Article 15 of the Protocol on the Accession of the People’s Republic of China (the Protocol) after its expiration.[56] The United States, Japan, and the European Union not only do not recognize China’s market economy status, but also coordinated their positions and set seven new marketing standards.[57] China stated that “common sense issues like market orientation do not need to be discussed at the General Council”[58] and opposed any denial of the diversity of development models and any discrimination against different development models in WTO reform. “We should take concrete actions to address the above wrongful practices which undermine the fair competition and market-oriented conditions,” China declared, and welcomed consultation and dialogue instead of chanting the empty slogan of “market-oriented conditions.”[59]

The WTO has never required members to be a market economy system, and never even defined what a market economy is.

Recommendations:

> China could bring the relevant provisions of the Protocol in relation to market economy[60] to the WTO General Council or ministerial meeting for clarification. Additionally, China could unite some members concerned about the very strict standards set by the United States. China should also carefully study the legislation and measures of the United States on the “non-market economy” and make a positive response, and strive to obtain more official recognition of its market status by other members.[61]

> The United States should abandon its seven criteria under the WTO framework, since there is no concept of a “non-market economy country” in the WTO rules or direct link between “non-market country” identification and the performance of obligations under WTO. The differences in economic models and values between the two countries have always been huge and difficult to bridge effectively in a short term. The two countries should not continue to argue on this issue, and more attention should be paid to urgent issues with more mutual interests, such as the reform of the Appellate Body.

Reform of the Appellate Body

China and the United States both are willing to reform the Appellate Body; specifically, they both want to resolve the problem of overdue reports. They and other members may, through successful dialogue on this issue, exchange their views and concerns on other problems, especially those criticized by the United States, such as domestic law, de facto precedent, judicial ultra vires in trade relief, etc.

Consequences of overdue reports

The United States advocated a change in adoption means from negative consensus to consensus once an Appellate Body report is overdue. However, its proposal would lead to more delay and complexity in the adoption of the report, and even a change in the DSB mechanism. China and most other members stressed that the report should be adopted by the DSB under Article 17.14 of the DSU.

Recommendations:

> It is suggested that the United States abandon the proposal on the change of adoption means and work with other members to find ways of ensuring an on-time report. In fact, the Multi-Party Interim Appeal Arrangement (MPIA) has introduced two innovative provisions: One is to allow the disputing parties to agree to an extension of the 90-day period, based on the recommendation of the arbitral tribunal;[62] the other is to allow the arbitral tribunal to take appropriate measures to streamline the proceedings, including page limits for submission of documents and decisions, effective control of the time of arbitration proceedings, and limitations on the number and duration of hearings, etc.[63]

Domestic law

According to the United States, the Appellate Body had no right to review the meaning of the domestic law of WTO members,[64] which is a matter of fact and does not fall within the jurisdiction of the Appellate Body.[65] Members such as China, European Union, Canada ,and India agreed.[66]

Recommendation:

> China and the United States should together suggest clarification of the legal issues and the legal interpretation in Article 17.6 of DSU,[67] and make clear the jurisdiction of the Appellate Body under Article 11 of the DSU should include objective review by the Panel, but not of the domestic law itself.[68]

De facto precedent

The United States challenged the Appellate Body’s request to follow a precedent, arguing its report should not be parallel with WTO rules. China believed that a de facto precedent could guarantee uniformity in the application and interpretation of WTO rules, satisfy the objectives of reliability and predictability of the multilateral trading system, and protect the reasonable expectations of its members. The essence of the U.S. objection is to seek justification for the Panel’s departure from the Appellate Body’s decision at the legal level.[69]

Recommendations:

> Except for the United States, almost all other members agreed with the de facto precedent approach.[70] It is suggested that China and the United States can learn from the experience of the precedent application by the International Court of Justice.[71] Attention should be paid not only to the rules themselves but also to the differences of the case and the explanation in individual cases.

Judicial ultra vires in trade relief

The United States strongly criticized the so-called “ultra vires” interpretation in trade relief cases by the Appellate Body and explicitly proposed to amend the DSU to strengthen the control of WTO members.[72] However, the U.S. proposal did not receive a positive response from other WTO members. China hasn’t expressed any view on this issue.

Recommendations:

> China and the United States should propose a special review mechanism upon those challenged ultra vires reports.[73] It is also suggested to delete the obligation of the Appellate Body in Article 3.2 of DSU to “clarify” the provisions of the Agreements under WTO, or to change Article 3.2 so that the Appellate Body can “clarify” the application of the relevant provisions only to resolve the current dispute.[74]

China-U.S. Agreements on Trade and Investment

While the views by China and the United States do not fully represent the position of all WTO members, they have significant impacts on promoting consensus on reform. Numerous issues, such as SOEs, subsidies, market economy, technology transfer, and national security, are related to both China-U.S. bilateral relations and WTO reform. Consultations on these issues are not confined to the WTO negotiating table; bilateral dialogue mechanisms can also provide a venue for negotiations on matters related to global governance.

Continue to Implement the Phase One Economic and Trade Agreement

China and the United States have a consensus on continuing to implement POETA. [75]However, the United States believes that China is still a long way from the purchase commitment. The obstacles for China to fulfill the commitment are the outbreak of the COVID-19 epidemic and the improper measurement standards[76]. The United States will keep tariffs imposed on Chinese goods by the former Trump administration in place but will decide how to proceed after a thorough review.[77]

Recommendation:

> Based on dialogue, China shall continue to implement POETA, and it is hoped that the United States may further and sincerely consider the issues of tariff reduction.

Consider the Phase Two Economic and Trade Agreement

Biden’s attitude toward signing a new agreement is uncertain since he has prioritized domestic economic recovery in the first weeks of his presidency.[78] China has not yet made a clear statement on the Phase Two Economic and Trade Agreement (PTETA) negotiation, but Chinese Foreign Minister Wang Yi made it clear that China and the United States should strengthen dialogue and economic and trade cooperation.[79] However, the prospect of PTETA is dark. The formation of an independent Asia Pacific Industrial Chain under the Regional Comprehensive Economic Partnership Agreement (RCEP) reached this year may reduce China’s willingness to compromise to a certain extent.[80] Biden has said that POETA “cannot solve the core issues in dispute, including industrial subsidies, support for state-owned enterprises, cyber theft and trade and technology plunder.”[81] It can be deduced that these issues are what Biden hopes to negotiate, but also the issues where the two countries are deeply divided.

Recommendation:

> It can be expected that the economic and trade dialogue between China and the United States will gradually resume in 2021. PTETA negotiations may also have an opportunity to begin. China and the United States should prepare for possible negotiations by listing in advance what issues they want to discuss and hold all-level dialogues before the formal negotiation.

Motivate the Signing of China-US BIT

The complementarity of the Chinese and U.S. economies is the driving force for China-US Bilateral Investment Treaty (BIT). With the signing of the China-US BIT, both sides can use each other’s strengths to achieve long-term and sustainable development. But China and the United States have divergences on the negative lists, transparency, the availability of information, and national security review. Also, the United States has accused China of oppressing foreign enterprises and forcing them to transfer technology in exchange for market access and has been trying to expand the prohibition of performance requirements under the Agreement on Trade-Related Investment Measures (TRIMs). China’s Foreign Investment Law stipulates the implementation of the “list of negative admissions,” establishes “transparency” as the basic principle, and proposes equal treatment of foreign-funded enterprises and voluntary technology transfer. Compared with the negative list in 2019, the negative list in 2020 reduces the number of restrictive measures from 40 to 33, with a reduction of 17.5%; in 2020, the negative list of free trade zone reduces the number of restrictive measures from 37 to 30, with a decrease of 18.9%.[82] In the past, China rarely mentioned performance requirements, and it has made great concessions[83] on the issue of performance requirement; thus it is almost impossible for China to adopt even stricter prohibition of higher performance requirements.[84] The United States advocated that there should be clear clauses on labor and environment and the standards should be continuously improved. In recent years, China has realized that it is unsustainable to develop by harming the environment and therefore has put more emphasis on improving labor and environment.

Recommendation:

> EU-China Comprehensive Agreement on Investment (EU-China CAI) negotiation was completed on Dec. 30, 2020, while China-US BIT negotiation started in 2008 but it is still unfinished. China and the United States should try to eliminate the divergences on investment. On the above-mentioned issues, China has made great concessions, but there are still great divergences, especially about SOEs. The United States advocated “ensuring State-owned enterprises compete with private enterprises on a commercial basis”[85] and hoped that all obligations under the future China-US BIT could be effectively applied to state-owned enterprises. SOE is the feature of China’s characteristic development model. China highly respects the important role of the market in allocating resources, but also allows state-owned enterprises to play an important role in economic development. Centralizing national advantageous resources and tackling strategic innovation projects with the help of SOEs precisely reflect the efficiency and vitality of market economy with Chinese characteristics.[86

Technology control

Limit the scope of technology control

China and the United States have different views on the control of technology. The U.S. believes the extraterritorial jurisdiction effect of its domestic law is authorized by the principle of person and is for national security. China believes the United States excessively expanded the principle of person by excessively defining national security and implementing long-arm jurisdiction over China. Restricting the application of technology control and reducing the restrictions on product export are beneficial for domestic enterprises to obtain a larger foreign market. Expanding the market is of great significance for enterprises to overcome the blow of the epidemic, to create more employment opportunities, to attract foreign investment, and to improve innovation ability. It is also beneficial to restore the normal operation of the supply chain, whose upstream and downstream enterprises are interdependent and inseparable. What’s more, developing the technological advantages of the United States and the production capacity of China is conducive to dealing with issues concerning global governance.[87] Dialogue is needed to find a balance point.

Recommendation:

> Both sides should delimit the scope of national security and improve the transparency of the national security review process, including the review basis and detailed procedures. Both sides must try to reach a consensus to adopt the practice of the trilateral investment agreement among Japan, the Republic of Korea and China, which reiterates the obligations in TRIMs and limits performance requirements to certain specific investments. Both parties should apply restrictive technology regulation prudently. The United States should not broaden the concept of national security and expand the application of domestic laws excessively. China should adhere to the principles of prudence, appropriateness, nondiscrimination, and transparency, and strive to strike a balance between safeguarding national security and achieving win-win global cooperation.

Capital Market

While more and more Chinese enterprises list in the United States to raise funds, the American capital market also needs to list Chinese companies. Recently, American regulators have frequently accused Chinese enterprises of falsification of financial reports and insufficient disclosure of audit reports and have proposed effecting a transparency and disclosure act. On Dec. 18, 2020, Congress passed the Holding Foreign Companies Accountable Act and President Trump signed it into law. A bill called the Ensuring Quality Information and Transparency for Foreign Listed Companies on our Exchanges Equitable Act (Equity Act), a sister act of the Foreign Holding Company Liability Act, is pending approval in Congress. Both acts directly affect the Chinese companies that have been listed or intend to list in the United States. If they fail to meet the requirements of the Holding Foreign Companies Accountable Act, Chinese companies will be excluded from trading or will not be allowed either to apply for listing or to issue new shares. The China Securities Regulatory Commission sincerely pursues dialogue with the Public Company Accounting Oversight Board about the transparency criteria, joint on-site inspection in listing Chinese corporation and treatment for misconduct.

Recommendations:

> China should actively negotiate with U.S. regulatory authorities to meet the requirements of the Holding Foreign Companies Accountable Act and the Equity Act through joint inspection, and to urge the U.S. authorities to respond to the joint inspection plan proposed by Chinese authorities. At the same time, China should seek to delay the implementation of the Holding Foreign Companies Accountable Act and passage of the Equity Act. Both the U.S. Securities and Exchange Commission and the U.S. stock exchanges have pointed out that the two acts against Chinese companies listing in the United States may lead to a great loss of Chinese companies, weaken the confidence of global investors in the United States capital market, and impair the international status of the United States as a global financial center. They believe that the market-driven approach, including stricter supervision of the U.S. branches of accounting firms, is a more viable option. Under the severe impact of the COVID-19 epidemic, the United States government may not want to drive away an existent $2.2 trillion investment and potential high-quality Chinese enterprises. Many American investment funds have also expressed their concern about the U.S. securities market without Chinese enterprises. Based on dialogue, China and the United States may achieve the outcome that the prohibition under Holding Foreign Companies Accountable Act will not be implemented and the passage of the Equity Act will be delayed.

[1] Council on Foreign Relations, U.S. Relations with China, https://www.cfr.org/timeline/us-relations-china , visited Feb. 22, 2021.

[2] On Nov. 27, 2019, President Trump signs the Hong Kong Human Rights and Democracy Act after it passes Congress with overwhelming majorities. The legislation authorizes the United States to sanction individuals responsible for human rights abuses in Hong Kong. On July 14, 2020, two weeks after Beijing makes a new national security law for Hong Kong, Trump signs an executive order ending the city’s preferential trade status with the United States. Ibid.

[3] On Aug. 6, 2020, Trump signs Executive Order 13942, Addressing the Threat Posed by TikTok, and E.O.13943, Addressing the Threat Posed by WeChat. On Sept. 18, 2020, U.S. Department of Commerce announces prohibitions on transactions relating to mobile applications (apps) WeChat and TikTok to safeguard the national security of the United States. https://www.commerce.gov/news/press-releases/2020/09/commerce-department-prohibits-wechat-and-tiktok-transactions-protect, visited Feb. 23, 2021.

[4] After the U.S. government’s decision to limit the number of Chinese journalists from five state-run media outlets in the United States to 100, down from 160, and designate those outlets as foreign missions, the Chinese government also announced that it would expel at least 13 journalists from three U.S. newspapers—the New York Times, Wall Street Journal, and Washington Post—whose press credentials were set to expire in 2020. U.S. Relations with China, https://www.cfr.org/timeline/us-relations-china , visited Feb. 22, 2021.

[5] Wang Yi urged the U.S. side to achieve three “abandonments,” http://news.china.com.cn/2021-02/22/content_77235460.htm, visited on Feb. 23, 2021.

[6] Reuters, “China calls for a reset, but U.S. says Beijing trying to ‘avert blame,’” https://www.reuters.com/article/us-usa-china-wang-yi-idUSKBN2AM018, visited on Feb. 23, 2021.

[7] An Gang, The Power of Communication, (13) China-US Focus Digest 29-30 (2020).

[8] An Gang, The Power of Communication, (13) China-US Focus Digest 31 (2020).

[9] Reuters, “US., China agree to semi-annual talks aimed at reforms, resolving disputes,” https://cn.reuters.com/article/instant-article/idUSKBN1ZA0HY, visited Feb. 20, 2021.

[10] Art 7.2 of POETA.

[11] Wang Huiyao, “There are four breakthroughs in the resumption of China-U.S. cooperation,” https://opinion.huanqiu.com/article/41PmXGrqWYu, visited on Feb. 21, 2021.

[12] Joint Statement on Trilateral Meeting of the Trade Ministers of the European Union, Japan and the United States, https://ustr.gov/about-us/policy-offices/press-office/press-releases/2019/january/joint-statement-trilateral-meeting, visited on Nov. 30, 2020.

[13]Ministry of Commerce, China and the World Trade Organization White Paper, p.4, http://www.scio.gov.cn/zfbps/32832/Document/1632334/1632334.htm, visited on Nov. 30, 2020.

[14] China and Global Governance: a round table on China and WTO reform, the Shanghai Institute of International Studies on the WeChat platform, Dec. 25, 2020.

[15] China Ministry of Commerce, “WTO Members Sign Joint Statement on Electronic Commerce,” http://chinawto.mofcom.gov.cn/article/ap/o/201901/20190102831485.shtml, visited on Dec. 6, 2020.

[16] Ministry of Commerce’s routine press conference question and answer on May 9, 2019, http://wss.mofcom.gov.cn/article/sy/201908/20190802894099.shtml, visited on Dec. 6, 2020.

[17] Ke Jing, WTO E-Commerce Negotiations and Global Digital Trade Rules, (3) International Outlook 47 (2020).

[18] Compared with the United States, China’s digital trade liberalization is lower, and the concept of digital trade has not been used in its international documents. The United States pays more attention to the digital nature of trade, the core of which is cross-border data flows, which does not specifically distinguish between trade in goods or services, and tends to replace “electronic commerce” with the term “digital trade.” See WTO, INF/ECOM/5. China defines e-commerce as cross-border trade in goods supported by internet platforms and related services such as payment and logistics, the core of which still lies in trade in goods, focusing on reducing border trade barriers. See WTO, INF/ECOM/19. E-commerce defined in the Law of the People’s Republic of China on Electronic Commerce is in the same as that in China’s proposal under WTO.

[19] In September 2019, China proposed in its second e-commerce proposal that members should be prohibited from engaging in discriminatory practices without legitimate public policy objectives and due process, restrictive measures such as disconnection of network equipment and products shall not be imposed, and the choice of such equipment, products and technologies should not be interfered with. See WTO, INF/ECOM/40.

[20] Ministry of Commerce May 9, 2019, routine press conference.

[21] Song Ruichen, The United States’ Claims, Measures on WTO Reform and Policy Choices of China, (8) International Trade 49 (2020).

[22] Ministry of Commerce May 9, 2019 routine press conference question and answer.

[23] Tian Feng et al., Issues Related to WTO Reform: The Positions of Main Members and China’s Negotiation Strategy, 5 (4) Financial Minds 99 (2020).

[24] U.S. Trade Representative, Report on France’s Digital Services Tax Prepared in the Investigation under Section 301 of the Trade Act of 1974, https://ustr.gov/sites/default/files/Report_On_France%27s_Digital_Services_Tax.pdf, visited on Dec. 6, 2020.

[25] Because the digital service tax is levied on income from the cross-border provision of services under the first service model of GATS, Cross-border Supply. See Zhang Zhiyong, Digital Services Taxation: A Justified Levy or Barrier to Trade in Services?, (4) International Taxation in China 33 (2020).

[26] Bigger digital companies mentioned by the European commission in its report “Fair Taxation of the Digital Economy” include China’s Alibaba, iqiyi, Didi Chuxing, and Qzone, which means at least these companies have been taken into consideration under the European Union digital services tax.

[27] WTO, WT /GC/W/757.

[28] Robert E. Lighthizer, How to Set World Trade Straight, (8) The Wall Street Journal, Aug. 20, 2020: https://www.wsj.com/articles/how-to-set-world-trade-straight-11597966341.

[29] First, countries that are members of the OECD; second, countries that are members of the G20; third, High Income Countries as defined by the World Bank; and fourth, countries that account for more than 0.5% of global imports of goods. Once one of the above criteria has been met, it cannot be self-identified as a developing country and no longer enjoys SDT.

[30] WTO, WT /GC/W/757.

[31] WTO, WT /GC/W/765 /Rev. 1; WT/GC/W/765/Rev.2.

[32] China Finance Ministry, Wang Yi talks about the reform of the international trade system: We should insist on three “must not lose,” https://www.fmprc.gov.cn/web/wjbz_673089/xghd_673097/t1594907.shtml , visited on Dec. 1, 2020.

[33] Wang Zhongmei, On the Classification of the Developing Countries and its Relevance to the Special and Differential Treatment, 36 (6) International Economics and Trade Research 96 (2020).

[34] Norway, together with Canada, Iceland, Mexico, New Zealand, Singapore, and Switzerland, submitted to the WTO Council on May 7, 2019: “Pursuing the development dimension in WTO rule-making efforts,” https://www.norway.no/en/missions/wto-un/our-priorities/trade/wto-world-trade-organization/pursuing-the-development-dimension-in-wto-rule-making-efforts/ , visited on Nov. 21, 2020.

[35] Graduation Clause proposed by EU. EU Concept Paper, http://trade.ec.europa.eu/doclib/docs/2018/september/tradoc_157331.pdf , visited on Dec. 1, 2020.

[36] Liu Xiaotong, American Attitude to WTO Reform under China-US Trade Friction, (7) Journal of Taiyuan City Vocational and Technical College 207 (2020).

[37] The United States specifically defines them as “administrative measures” in its proposals. WTO, JOB/GC/204/Rev.2, JOB/CTG/14/Rev.2.

[38] WTO, JOB/GC/204/Rev.2, JOB/CTG/14/Rev.2, para.10, 11.

[39] Aileen Kwa & Peter Lunenborg, “Notification and Transparency Issues in the WTO and the US,” November 2018 Communication, South Centre Research Papers 92, March 2019, p.17.

[40] WTO, G/C/M/134, para.9.89.

[41] There are still some questions to be answered: 1. Who has the authority to decide punishment measures involving the deprivation of the rights of members? 2. Who will implement punishment decisions? 3. What is the procedure for the implementation of punishment measures?

[42] WTO, G/C/M/134, para.9.64.

[43] WTO, JOB/GC/204/Rev.2, JOB/CTG/14/Rev.2.

[44] He Xiaoyong & Chen Yao, “Seeking Common Ground while Reserving Differences”: Evaluation of WTO Reform Proposals and China’s Counterproposal, 26 (2) Journal of Shanghai University of International Business and Economics 35 (2019).

[45] He Xiaoyong & Chen Yao, “Seeking Common Ground while Reserving Differences”: Evaluation of WTO Reform Proposals and China’s Counterproposal, 26 (2) Journal of Shanghai University of International Business and Economics 34 (2019).

[46] Tian Feng et al. Issues Related to WTO Reform: The Positions of Main Members and China’s Negotiation Strategy, 5 (4) Financial Minds 88 (2020).

[47] See Yu Ying, New Rules of Industrial Subsidies Pushed by the United States and Europe—China’s Position and Countermeasures, 34 (1) China Business and Market 27 (2020). See also Yang, Ruilong, The logic, Dilemma and Future Reform of State-owned Enterprises, https://new.qq.com/omn/20190719/20190719A047LS00.html , visited on Nov. 21, 2020.

[48] Chen Xi, Research on China’s Trade Remedy Response Under the Background of WTO Subsidy Reform, 24 (4) Journal of Yangzhou University (Humanities & Social Sciences) 39 (2020).

[49] Incomplete notification: Some subsidy programs have not been notified. Comparing the subsidy programs announced(https://www.USaspending.gov/)with the subsidy notification provided by the United States to the WTO (G/SCM/N/343/USA), at the federal level, the Certified Development Loan Program in charge of Small Business Administration, the Scientific Office Financial Aid Program in charge of Department of Energy, etc. are not listed in the notification.

Excessive notification: For example, the Digital Media Tax Incentive Program in Louisiana is not required to be notified according to WTO rules but it is still notified. See Yang Rongzhen, Shi Xiaojing, Main Characteristics and Compliance of the United States’ Subsidy Policy —Analysis Based on the 2019 United States Subsidy Policy Notification, (4) International Economic Review 149-150 (2020).

[50] Chen Xi, Research on China’s Trade Remedy Response Under the Background of WTO Subsidy Reform, 24 (4) Journal of Yangzhou University (Humanities & Social Sciences) 39 (2020).

[51] WTO, WT/GC/W/773, para.2.5, 2.6.

[52] WTO, Russia-measures concerning traffic in transit, Report of the Panel, WT/DS512/R, para. 7.41.

[53] WTO, Russia-measures concerning traffic in transit, Report of the Panel, WT/DS512/R, para. 7.51.

[54] Zhou Hanmin, “The WTO faces three major crises,” The Paper,  https://www.thepaper.cn/newsDetail_forward_10125354 , visited on 26 November 2020.

[55] Gong Baihua, United States Unilateral Economic and Trade Sanctions and Their Legal Responses against the Background of Sino-US Economic and Trade Friction, (6) Business and Economic Law Review 6 (2020).

[56] Robert E. Lighthizer, How to Set World Trade Straight, (8) The Wall Street Journal (2020).

[57] 1. Decisions of enterprises on prices, costs, inputs, purchases, and sales are freely determined and made in response to market signals; 2. Decisions of enterprises on investments are freely determined and made in response to market signals; 3. Prices of capital, labor, technology, and other factors are market-determined; 4. Capital allocation decisions for or affecting enterprises are freely determined and made in response to market signals; 5. Enterprises are subject to internationally recognized accounting; 6. Enterprises are subject to corporation law, bankruptcy law, and private property law; and 7. There is no significant government interference in enterprise business decisions described above. Joint Statement on Trilateral Meeting of the Trade Ministers of the United States, Japan, and the European Union, https://ustr.gov/about-us/policy-offices/press-office/press-releases/2018/may/joint-statement-trilateral-meeting, visited on Nov. 19, 2020.

[58] At the WTO General Council on Oct. 13, 2020, Ambassador Zhang Xiangchen of China and Ambassador Dorothy Shea of the United States held a heated debate on the treatment and market-oriented conditions of developing countries, http://wto.mofcom.gov.cn/article/xwfb/202010/20201003007643.shtml , visited on Oct. 10, 2020.

[59] Press Briefing on Issues Related to WTO Reform convened by Ministry of Commerce, http://www.mofcom.gov.cn/article/i/jyjl/l/201811/20181102810560.shtm , visited on Dec. 1, 2020.

[60] For example, Article 15 of the Protocol.

[61] Song Ruichen, The United States’ Claims, Measures on WTO Reform and Policy Choices of China, (8) International Trade 54 (2020).

[62] MPIA, Annex 1, Agreed Procedures for Arbitration under Article 25 of the DSU in Dispute DS X , JOB/DSB/1/Add.12, April 30, 2020. para. 14. The requirement to obtain the consent of the disputing parties not only respects the autonomy of the parties, but also indicates that the appeal arbitration should improve the efficiency of the report without affecting the substantive decision of the case as far as possible. Shi Jingxia, WTO Multi-Party Interim Appeal Arbitration: An Alternative to Appellate Review Based on Arbitration, 42(6) Chinese Journal of Law 180 (2020).

[63] MPIA, Annex 1, Agreed Procedures for Arbitration under Article 25 of the DSU in Dispute DS X , JOB/DSB/1/Add.12, April 30, 2020. para. 12.

[64] WTO, Minutes of the DSB Meeting, https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S009-DP.aspx?language=E&CatalogueIdList=233206,233115,232524,232330,231963,231754,231034,231002,230905,230808&CurrentCatalogueIdIndex=1&FullTextHash=&HasEnglishRecord=True&HasFrenchRecord=True&HasSpanishRecord=True , visited on Dec. 1, 2020.

[65] Li Xiaoling, Negotiation Process of WTO Appellate Body Reform and Crossroad Choices, 36 (4) International Economics and Trade Research 102 (2020).

[66] Peng Delei, The WTO Appellate Body at the Crossroads: Reform Observation and Recent Practice, 36 (9) International Economics and Trade Research 91 (2020).

[67] Marc Lynedjian, Reform of the WTO Appeal Process, (6) Journal of World Investment & Trade 809 (2005).

[68] Zheng Wei & Guan Jian, The Situations, Focuses and Responsive Suggestions of WTO Reformation, (1) Review of international law in Wuhan University 80 (2019).

[69] Song Ruichen, The United States’ Claims, Measures on WTO Reform and Policy Choices of China, (8) International Trade 52 (2020).

[70] WTO, WT /DSB/M/250; WT/DSB/M/265.

[71] As long as there is a clear precedent in the relevant dispute, the International Court of Justice usually does not initiate new legal research unless there are valid reasons to distinguish the new case from the precedent, or there are obvious errors in the precedent, or the precedent is no longer adapted to the new situation of the international community. Wang Tao, Precedent effect of judicial decisions of the International Court of Justice, (8) Newspaper of People’s Court (2020).

[72] WTO, TN/DS/W82/Add.1.

[73] Yang Guohua, Legal Problems in the Crisis of WTO Appellate Body, (1) Journal of International Law 76 (2019).

[74] WTO, WT/CG/W/760.

[75] Dong Yan, POETA promotes the dynamic balance of China-the United States economic and trade, (3) Economic and Trade Observations 14-16 (2020). Zhou Mi, POETA opens a new stage of China-the United States economic and trade cooperation, (4) World Affairs 16-17 (2020).

[76]  The commitments are measured in dollars, not volume (e.g., barrels of oil). As a result, lower oil prices in 2020 have made it even more unlikely that China could reach the goal.

[77]  Reuters, “Yellen says U.S. will keep tariffs on China in place for now,” https://www.reuters.com/article/us-usa-trade-china-idUSKBN2AI34D, visited on Feb. 20, 2021.

[78] Simon Lester, “Biden Responds to Steelworkers on Trade,” International Economic Law and Policy Blog,  https://ielp.worldtradelaw.net/2020/07/biden-responds-to-steelworkers-on-trade.html, visited on Nov. 28, 2020.

[79] Wang Yi: a framework for the healthy development of China US foreign relations, https://www.fmprc.gov.cn/web/wjbzhd/t1839415.shtml, visited on Dec. 13, 2020.

[80] Fang Xiaoqiang, Specific requirements and realistic challenges of import of goods and services in the first phase of Sino-U.S. economic and trade agreements, (11) Practice in Foreign Economic and Trade Relations 29-30 (2020).

[81] Jennifer Epstein, Biden Slams Trump-China Trade Deal as Lacking on Key Dispute, Bloomberg News,  https://www.bloomberg.com/news/articles/2020-01-15/biden-slams-trump-china-trade-deal-as-lacking-on-key-disputes , visited on Nov. 28, 2020.

[82]Qian Zhou, ”China’s 2020 New Negative Lists Signal Further Opening-Up,” China Briefing, July 1, 2020, https://www.china-briefing.com/news/chinas-2020-new-negative-lists-signals-further-opening-up/, visited on Oct. 15, 2020.

[83] Recently signed Investment promotion and protection agreement between Japan, Republic of Korea and China (Hereinafter “ Trilateral Investment Agreement”) and Canada-China Promotion and Reciprocal Protection of Investments Agreement both contained revised TRIMs Articles about prohibition of performance requirements.

[84] Chen Huiping & Karl P.Sauvant, Negotiations on the Bilateral Investment Treaty between China and the United States: Consensus, Controversies and Prospects, (4) International Economic Law Journal 107-117 (2020).

[85] US-China Economic and Security Review Commission, Policy Consideration for Negotiating the United States-China Bilateral Investment Treaty.

[86] Lipeng Sun, American scholars expose Trump: Why force China’s SOEs to reform?, visited on Feb. 19, 2021. – can’t find the link

[87] Climate change, new epidemic and situation network security etc.