Don’t Strengthen China Any Further – Watching America

Biden’s restrictions on investments in China pursue a new strategy of minimizing risk. If it fails, the West will lose a lot, too.

The investment restrictions with which the U.S. administration is now hoping to prevent high-tech knowledge transfer to the Chinese military are in line with the new Western consensus on engagement with China. The idea is to limit risk but not disengage too much in trade relations.

In this case, the focus is semiconductors or artificial intelligence that could be used for modern weapons. Since the U.S. guarantees the security of some allies in Asia, potentially including Taiwan, Biden’s decree makes strategic sense. No one in the West can have any interest in strengthening China’s military forces, which are already growing at a rapid pace.

Difficult Economic Situation

Politically, however, such measures, which are also being prepared in Europe, test relations with China. In Beijing, Joe Biden’s step will be interpreted as another unfriendly move to hinder China’s own rise, and not just because of that country’s difficult economic situation. Countermeasures are likely, and in this context, attempts to disentangle China from its alliance with Russia won’t get any easier.

The West’s old China strategy was based on inclusion and was just as naïve as policies toward Russia. The new strategy attempts to keep trade and investment alive, with limitations, under conditions of political rivalry. If it fails, the West will lose a lot, too.