Magazine Article - Project Syndicate

Joseph Nye Says

| July 03, 2019

A Project Syndicate Say More Interview

Project Syndicate: In a recent PS commentary, you claim that observers often underestimate the challenges China faces — including a soft-power deficit and an allergy to any reform that doesn't strengthen the Communist Party — and you go on to suggest that the world's second-largest economy may have "feet of clay." Do you think that China's recent decision to upend trade negotiations with the US by rewriting the draft agreement — ostensibly a show of strength — was actually driven by these underlying weaknesses?

Joseph Nye: I think China's rejection of the proposed trade agreement in early May was a mistake, but one that was driven more by domestic politics and nationalism than by careful economic calculation. Both sides will lose from a trade war, with China possibly losing more. But I think that President Xi Jinping believed that US demands related to technology and subsidies to state-owned enterprises would allow too much American interference in China's domestic development strategy, and thus could be used by critics to weaken his position. No trade deal is likely to "solve" the problem, but rules of the road can help....

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For Academic Citation:Joseph Nye Says.” Project Syndicate, July 3, 2019.