Laura He, CNN

The United States is not seeking to decouple from China’s economy or hold it back, Commerce Secretary Gina Raimondo told senior Chinese economic officials Tuesday in Beijing.

“The US-China commercial relationship is one of the most globally consequential, and managing that relationship responsibly is critical to both our nations and indeed to the whole world,” Raimondo told a group of officials, including Vice Premier He Lifeng, during her second day of meetings in the country.

“And while we will, never of course compromise in protecting our national security, I want to be clear that we do not seek to decouple or to hold China’s economy back,” she said.

Hours later, when she met with Chinese Premier Li Qiang, Raimondo emphasized that point.

“President Biden asked me to come here to convey the message that we do not seek to decouple,” she told Li. “We seek to maintain our $700 billion dollar commercial relationship with China.”

The Chinese premier said he hoped the two countries can strengthen communication and maintain the health of US-China economic relations.

“Only through dialogue can we understand each other’s concerns, find common ground and increase the possibility of cooperation,” he said.

“Economic and trade relations are the ballast for sino-US relations,” he added. “A well-maintained economic and trade relationship is beneficial to both [our] countries and the whole world.”

“We hope that commercial relationship can provide stability for the overall relationship,” Raimondo said in reply to Li.

She also said the United States hoped to work with China on other areas of concern, such as climate change, artificial intelligence as well as America’s fentanyl crisis.

‘Rational’ practices

Vice Premier He, the head of China’s powerful economic planning agency, noted earlier that Chinese President Xi Jinping and US President Joe Biden met in Bali last November where they had reached an important consensus for the development of bilateral relations.

He said that he hoped the United States will work with China to “adopt rational and practical practices” and put the leaders’ recommendations into practice. He added that he was ready to work with Raimondo.

Earlier Tuesday, Raimondo had met with Culture and Tourism Minister Hu Heping. The two agreed to advance “people to people ties” through increased tourism as well as educational and student exchanges, according to Raimondo.

The commerce secretary’s visit to China, the fourth by a Biden official in three months, comes as the two sides seek to stabilize rocky relations. Her visit also coincides with a worsening slowdown in the world’s second largest economy.

China’s growth forecasts have been downgraded by economists as exports and foreign investment slump, a real estate crisis deepens and worries spread about its general financial health.

From Beijing’s perspective, Raimondo’s department has played a key role in a number of areas, including restricting semiconductor exports, that have been the source of mounting friction.

On Monday, Raimondo said it was “profoundly important” that the US and China have a stable economic relationship. She added that the majority of US-China trade did not impact national security concerns, and it was possible to promote and protect US trade and security at the same time.

After her Monday meetings, the United States announced that the two sides would establish new channels of communication for economic issues, including a working group composed of officials and businesses from both countries and a mechanism to exchange information on US export control enforcement.

Graham Kanwit

Whether China is a developing or developed nation has long been a source of debate among researchers and China experts — especially as China has risen to become the world’s second largest economy and a global manufacturing powerhouse.

At the recent summit of the BRICS countries (Brazil, Russia, India, China and South Africa) in Johannesburg, Chinese leader Xi Jinping said “China has been and will always remain a member of [the] developing countries.”

However, in Washington, lawmakers in Congress have introduced legislation requiring the U.S. administration to use its influence in international organizations to strip China of its status as a developing nation.

The debate may sound academic, but it has real-world implications. The benefits that come with the developing nation label include preferential tariff treatment from developed countries, making their exports more competitive in international markets. China also uses its developing status to justify subsidies to industries such as fishing and tech, even when many are effectively state-owned and have global impact.

The development status of a country is determined in different ways by different international organizations. The World Trade Organization, for example, allows countries to self-identify as “developing” or “developed.”

Other international organizations like the World Bank and International Monetary Fund employ a variety of metrics to measure a country’s standard of living, using indicators such as average national income per person, gross national income (GNI) per capita, life expectancy, and education measures.

Weifeng Zhong, a senior research fellow at George Mason’s Mercatus Institute, tells VOA these are different ways of trying to measure the same thing.

“I think it comes down to, on a per capita level — meaning per person — how high the income is, so when the national income per person in a country is high enough, we think of them as developed country rather than developing country,” Zhong said.

How China is classified

Beijing classifies itself as a “developing” country in the WTO. However, the World Bank and U.N. Development Program classify China as an “upper middle income” country, while the IMF calls the country an “emerging and developing economy.”

Analysts say China is unique in ways that make it defy easy classification.

“You have a country that has many of the traits of a developing nation and has historically qualified as one and technically in many ways still qualifies as one, but has also many of the attributes of a rich advanced economy and in some ways a massive rich advanced economy,” Philippe Benoit, director of research at Global Infrastructure Analytics and Sustainability 2050, told VOA.

China also defies classification on another commonly used indicator – energy consumption. “For structural reasons, energy demand, energy use in China is going to increase for a number of years until they achieve a level of development, a level of income per capita that allows them to flatten that,” Benoit said.

China’s burgeoning energy needs have spurred the state to seek resources in poorer developing countries.

But China often behaves like a developed nation internationally, some analysts say. Many developing countries, particularly Latin America, Africa, and Central Asia, rely on China for development assistance and infrastructure funding.

Benoit calls China a “hybrid superpower.” He said its global power projection approximates that of a traditional superpower and it displays developed country traits such as its major investments in tech and high speed rail . It also has highly developed cities such as Beijing and Shanghai.

But he adds, China also has developing country traits, such as the persistence of poverty in many areas of the country. In 2019, the International Energy Agency (IEA) found more than 35% of the population in China still lacked clean cooking technology and relied on highly polluting fuels such as coal.

“What we mean when we say developing is a country that faces significant poverty issues — where there’s inadequate access to water, sanitation, transport, education — countries where the standards of living are basically, as a general proposition, unacceptably low,” Benoit said.

Robert Ross, professor of political science at Boston College and associate at the John King Fairbank Center for Chinese Studies at Harvard University, told VOA the developing nation classification no longer matches economic realities given China’s reduction of extreme poverty and its status as the second largest economy and the world’s largest manufacturer.

“Many Chinese people acknowledge ‘it makes no sense to treat us as a developing country,’ and they will acknowledge that it undermines both the interests of the developing world and gives them unfair advantages in the American domestic economy,” Ross said.

US-China relations

The question of China’s development status has added to Washington and Beijing’s strained relationship. In March, the U.S. House of Representatives unanimously passed a bill called the PRC Is Not a Developing Country Act.

On June 8, the U.S. Senate Foreign Relations Committee also approved the bill, now retitled the Ending China’s Developing Nation Status Act. It calls on the State Department to “take actions to stop China from being classified as a developing nation by international organizations.” No date has been set for the full Senate to vote on the bill.

In response to the Foreign Relations Committee’s approval of the act, Wang Wenbin, spokesman for China’s Ministry of Foreign Affairs, accused the U.S. of attempting to sabotage China’s development.

“China’s status as the world’s largest developing country is rooted in facts and international law. It’s not something that can easily be wiped away by a U.S. Congressional bill,” Wenbin said at a June 9 press conference. He added, “It’s not up to the U.S. to decide whether China is a developing country.”

Ross said China’s development status “is not a very important question,” but rather a political issue between two competing superpowers.

“China is resisting American efforts to improve American competitiveness against China, and so with that, the United States has a trade war and a tech war to undermine China’s economic development and its technological development. For China’s part — it’s the part that’s competing with the United States — it’s going to use every instrument available to improve its own position.”

With many developing nations benefiting from Chinese investments and trade, Ross said these countries are unlikely to endorse efforts by the U.S. to change China’s development status, especially since they see this issue as a political war of words between the two superpowers.

(Source: VOA News)