America does not seek economic decoupling from China, says US ambassador in Beijing Nicholas Burns

The US will continue to engage China on global issues such as climate change and health, said US diplomat Nicholas Burns. PHOTO: REUTERS

SINGAPORE - The United States is not seeking to decouple its economic ties from China, US Ambassador In Beijing Nicholas Burns said on Thursday.

However, he noted that the US will continue to compete in technology with the world's second-largest economy and keep reminding it of its commitments to multilateral agreements on global trade and investment.

"We're not seeking a decoupling," said Mr Burns, who has been a US diplomat since 1995, in a virtual session at the Milken Institute's Asia Summit 2022 in Singapore.

He also said the recent deterioration of ties between the two nations has no parallels with the Cold War between the US and the Soviet Union, as the relationship with China is far more complex given the economic ties.

"We have a major economic connection. Singapore does and all the other Asian countries do. That makes it different," he said.

The ambassador said the US and China have a US$650 billion ($938 billion) two-way annual trade, which despite new tariffs and sanctions has increased in the last two years.

In addition, American citizens hold about US$1.2 trillion in Chinese equities and bonds, while Chinese nationals hold double the amount in the US market, he said.

There are 11,000 American companies currently invested in China, he added.

However, Mr Burns said most foreign companies in China are not making major new investments because they want to see uniformity in economic policy.

"There are questions about economic policy here in China," he said, referring to Chinese rules that limit foreign companies' ability to compete with Chinese firms and curb their access to the local market.

Mr Burns agreed that there are national security concerns among lawmakers in Washington about Chinese investment in the US.

He said the US will continue to engage China on global issues such as climate change and health.

"So there's an engagement part to our agenda, but we also need to confront and compete with China," he added.

He said the US will confront China on its policies that work against its commitment to the World Trade Organisation.

He said the US is also concerned about what it sees as an aggressive turn in its policy towards Taiwan.

China claims Taiwan as a breakaway part of the country.

Washington acknowledged the Chinese position that Taiwan was part of China, but seeks a negotiated settlement of the issue and opposes a military solution.

"The major problem here is that we are seeing a new offensive, if you will, by the People's Republic of China getting very aggressive towards Taiwan," the ambassador said, referring to China's military drills after US House Speaker Nancy Pelosi visited Taiwan earlier this year. The visit raised questions about a change in US policy.

"They fired missiles over Taiwan into Japanese waters. They simulated a blockade, a naval and air blockade. So we're actually concerned that the party trying to change policy here is Beijing, and we've warned them that we won't agree to that," said Mr Burns.

He said all nations, especially those in Asia, should be concerned about China's actions that threaten the flow of trade through the Taiwan Strait.

"We've all got to be concerned, everybody in your room in Singapore, with the fact that the majority of container traffic in the world flows through the Taiwan Strait. It is a lifeline of the global economy and, of course, Singapore's economy," he added.

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