China always lose in negotiation with the Americans, at least till now. The Americans approach every negotiation from a position of strength, and the formula is very simple. For example, if the Americans want 10 items from China, they would slam China with 20 items before the negotiation, like bans or sanctions. The Chinese will come to the negotiation table to ask for 10 items in return for giving the Americans 10 items they demanded. The Americans give up 10 items for 10 items from the Chinese. Superficially it seems fair, 10 for 10. In reality the Chinese give up 10 items for nothing, and the Americans get 10 items plus another 10 items they put up before the negotiation, ie the Americans get 10 + 10 items.
This kind of negotiation has been going on for ages, with the Chinese looking silly and the Americans patting themselves on their backs and laughing at the stupidity of the Chinese, treating the Chinese as simpletons, country bumpkins. The Chinese have no choice as they were weak and depending a lot on the Americans.
Today, China is no longer the weak and silly country bumpkins. Would China still accept such negotiating formula and walk out looking silly to the Americans after every negotiation? Were the Chinese really that stupid or just have to accept the short end of the stick in the past and would no longer want to continue with this one sided game?
The latest negotiation in Geneva ended with a temporary deal. Immediately after the deal, the Americans slammed China with new sanctions on chips and also imposed a world ban on the use of Huawei chips, dictating to all countries not to use Huawei chips or be charged for violating American laws. A few days later, Trump is accusing China of not following up with the agreements and not selling rare earth to America.
What is going on? What were really agreed upon in the Geneva deal? The Americans had slammed China with hundreds of bans and sanctions since the start of this trade and tariff war. And China only responded with the ban on rare earth sales. Did China agree to resume sale of rare earth and gets nothing from the Americans in return? What about the Americans lifting the ban on chips sale to China? Even this alone is not enough. China should demand the Americans to withdraw all sanctions and tariffs in return for the sales of rare earth. For this is the only item China threw at the Americans in response to the hundreds of items the Americans thrown at China, including banning Chinese students in American universities.
If China does not demand to return to square one, and accept a quid for quo, ie one item for one item, it is returning to the old formula used by the Americans mentioned in the introduction paragraph above.
China's one item, rare earth ban is against the hundreds of items the Americans slammed at China. For Americans not to withdraw the rest of the bans and sanctions, China is again the losing party, the fool that the Americans have made them out to be for centuries. This must change. China must not accept the old American formula and be cheated over and over again from a position of weakness and be laughed at by the Americans and the whole world as fools and simpletons.
Hope the Chinese would not fall into the same trap in the London Talk and negotiate only about what is in front of their nose and forget about how it all started and be happy with taking two back forgetting that the Americans have grabbed a hundred items from them. The negotiation must start from the Chip War and the Americans must roll back everything from square one. China should not go for a quick settlement.
10 comments:
China must never put the rare earth ban against the USA on the negotiating table as it will be suicidal. Relaxing the ban will allow a loophole for the USA to stockpile and be able to make more weapons by also negotiating a truce in the trade and tariff battle, to give them the time to continue with weapons production and eventually using such weapons to target China. The targeting of China will be a relentless pursuit of the USA, no matter which party is in the White House. China must be absolutely clear about the USA's intention, even when Xi is no longer around.
Further, China must guard against other USA allies trying to circumvent the ban by using loopholes to resell such rare earths to the USA under the radar. The UK and South Korea had been caught doing so. India is also another target for the USA to source for Chinese rare earth elements. The new vetting system put up by China is going to affect India's intention to set up an AI and EV hub, which China must watch carefully and calculate how much rare earth elements India actually needs.
Trade war or tariff war, China has many cards to play with in the game of retaliation. The USA had tried insidiously to circumvent the trade war by falsifying country of origin of its soya beans as being from Argentina and Brazil which were discovered by the Chinese after analyzing its protein content. The soya bean falsification game is now up, and USA farmers have no more cards to play with. The USA agriculture sector is dying out and food security is going to be a problem for the USA.
The battle is still ongoing in the semiconductor sector, with China catching up in the high-end sector as well. Even Jensen Huang is nervous and is forced to set up a R & D unit in China, knowing this is the only way for Nvidia to fight the battle. The USA can erect more hurdles to keep countries from using Huawei chips, but the Chinese chip market is enough for Huawei to play around.
If China had been like the Native American Indians or the Aborigines of Australia, it would not have lasted more than five thousand years. This is in spite of the many attempts by the Anglo-Saxon Whites trying to tear it apart. The Anglo-Saxon Whites are still at it, with trade wars, tech wars and tariff wars still ongoing.
I bet China would not collapse so easily today, when it has all the cards to play - military, economic and I would say, a more undivided, more patriotic, more highly educated and skilled population to back the country up.
My bet is the negotiation will center on rare earth, the item that the USA is dangerously short of and critically needed. Not just for the military and weapons but almost every sector of the manufacturing regime. What kind of manufacturing is the USA hoping to lure back without the guarantee of rare earth elements being freely available. China has hit the raw nerve of the USA and Trump has no room to left to maneuver.
Trump can kill everything in the USA - agriculture, motor vehicles, iron and steel industry, university education, tourism and ban the whole world from visiting USA for all that the world cares. Who wants to buy his US$5 million golden visa in the face of his antics.
The cycle for western dominance is coming to an end. The Chinese calls it the mandate of heaven and no more with the West.
Everything is going wrong in the West. Internal strife, clowns as leaders, enemies all over the world, unable to produce real talents and leaders.
The Chinese is rising, Indians rising, Arabs and Muslim rising, Africans rising while the whites are falling apart.
Many people, few decades earlier, had predicted the rise of China. An equally number like Gordon Chang predicting the reverse. But a couple of events that are happening now were not evident when those predictions were made - the trade, semiconductor and tariff wars and the destructive agenda of Trump that is destroying the USA hegemony faster than anticipated. And, of course, the creation of BRICS, downplayed by the West especially the G7, but now a very serious competing force to be reckoned with. Yes, keep downplaying the effectiveness of your enemy, who may overwhelm you without you realizing it.
Chips depend on rare earth. Rare earth depends on China. Chip ban affects China. Rare earth ban affects the USA. Who is more jialat?
Trump is again lying that Xi has agreed to sell more rare earth to America without America agreeing to sell more chips to China, meaning Xi is stupid and bowing to Trump's demand. Just like claiming that he had been talking to Xi all the time but nothing of the sort happening.
We know he lies all the time. Agreed to sell more does not mean will sell more. How much more? Trump always like to gloat about his art of the deal. His 'Art of the deal' can only work on other kids, not on adults. It does not need a rocket scientist to interpret what he is saying. Yes, Trump always likes to tell everyone he is having the upper hand on things in his delusional mind and his knows his MAGA base will swallow everything he gloated about.
Gordon chang was actually an agent of China. He had successfully shifted the attention of the west on China (thinking China will collapse) for the last 20 yrs. This allowed China to quietly developed into what it is today. So Gordon must be awarded a medal for his great effort.
Sorry, this is off topic, but it involves illegal colonialization, sovereignty and has geopolitical implications for people who cares and are interested. https://www.youtube.com/watch?v=J8JcAYihzic
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