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Joseph Nye: "China Cannot Surpass US Economy... Trade War if Trump Returns to Power"

"There has been a common belief that China would surpass the United States in terms of Gross Domestic Product (GDP) by 2030. However, I would bet that such a thing will not happen."


Joseph Nye, a world-renowned scholar and Harvard University professor in the United States, evaluated that China, which is engaged in a hegemonic competition, is unlikely to catch up with the U.S. economically. He also predicted that if former President Donald Trump regains power in the upcoming U.S. presidential election this November, a U.S.-China trade war would be inevitable and the risk of military conflict would increase.


In an interview with the Hong Kong South China Morning Post (SCMP) released on the 2nd, Professor Nye diagnosed the U.S.-China relationship as follows. He said, "If U.S. President Joe Biden succeeds in his re-election, I think the (China) policy we have seen over the past 3 to 4 years will continue," adding, "Another scenario is the election of former President Trump. Trump himself is very unpredictable, and it is much harder to anticipate what his policies might be." He continued, "One possibility is a trade war," adding, "It is a very bad idea, but former President Trump has already mentioned it."


When asked whether the risk of military conflict between the U.S. and China would increase if former President Trump were elected, he replied, "There is always a risk of miscalculation in areas like the South China Sea and the Taiwan Strait," adding, "That risk exists whether it is former President Trump or President Biden. However, former President Trump is somewhat more risky."


However, he viewed the likelihood of military conflict in the South China Sea or a Chinese invasion of Taiwan becoming a reality as low. Professor Nye said, "There is frequent talk in Washington that Chinese President Xi Jinping wants to prepare to take control of Taiwan by 2027," but he personally thinks that is unlikely. He added, "I believe China has learned a big lesson from Russia's failure to quickly occupy Ukraine during its invasion," and emphasized, "It is very important for the U.S. to maintain the 'One China' policy. It has been effective over the past 70 years and will continue to be effective."


On the same day, Professor Nye acknowledged, "China has done very well economically and deserves full recognition for that," but pointed out, "China is now facing another problem called the middle-income trap." He diagnosed that due to three trends?population and labor force decline, productivity decrease, and policies encouraging state-owned enterprises over private companies that are more active in developing new technologies?China is unlikely to return to the high growth levels of the past.


He said, "There are people in Washington who exaggerate the threat from China," adding, "I think that should not be the case." Regarding forecasts from some scholars that China’s economy will surpass the U.S. within a few years, he reiterated, "I don't think that will happen," and "I would bet that it will not happen." Furthermore, on the diagnosis that China aims to overturn global hegemony through the Belt and Road Initiative and economic blocs, he said, "It is not about overturning the table but about tilting it slightly in their favor," and dismissed the idea that this would overturn the world order established since 1945.


Along with this, Professor Nye cited the worst policy China has pursued against the U.S. over the past decade as "China’s belief after the 2009 financial crisis that the U.S. was in decline, leading to the abandonment of Deng Xiaoping’s diplomatic policy and replacement with a more aggressive foreign policy." Among U.S. policies toward China, he mentioned the Trump administration’s tariff measures. On the other hand, he cited China’s participation in the 2015 Paris Climate Agreement and cooperation with the U.S. on climate change as the best policy.


Regarding recent U.S. sanctions on advanced technologies such as semiconductors, he said, "There is a basis for delaying technology transfer in sectors related to security," but pointed out, "It should not be applied to the entire economy." Concerning the so-called 'TikTok ban bill' recently pushed by the U.S. Congress, he focused on the issue of reciprocity. He said, "China does not allow Facebook within China, so why should the U.S. allow TikTok to transmit information about Americans?" He added, "Many people think this is unfair on China’s part. That is exactly the problem with TikTok."


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