The administration of US president-elect Barack Obama is not likely to pick a fight with China by establishing closer formal commercial ties with Taiwan, considering Washington’s many common interests with Beijing, a former assistant US trade representative said yesterday.
Charles Freeman, an expert on US-China relations, said that signing a US-Taiwan free trade agreement or Washington’s support for Taiwan’s participation in the P4 group of countries — consisting of New Zealand, Singapore, Chile and Brunei — could easily “upset China.”
“Any move by the US to support Taiwan’s participation in organizations such as the P4 will require Beijing’s approval,” Freeman said in Washington during a videoconference with representatives of Taiwan’s Office of Trade Negotiations.
Freeman said, however, that the Obama administration would continue to urge China to be a responsible stakeholder and try to pressure it into expanding domestic consumption and appreciating its currency.
Treasury secretary-designate Timothy Geithner, who lived in China where his father worked on aid projects and speaks Cantonese, will be in charge of continuing the Strategic Economic Dialogue and monitoring the issue of currency manipulation, Freeman said.
“It is very likely that Geithner will work harder than [US Treasury Secretary] Henry Paulson to get the EU, Japan and others to work with the US in the International Monetary Fund and other multilateral settings against China’s currency interventions,” Freeman said.
When asked about the Obama administration’s plan for a US-P4 agreement, Freeman said there would be little political cost for the US’ negotiators in playing an active role in the talks, as the agreement is still being negotiated.
“Indeed there may be some political support because the P4 promises to give the US additional opportunities in markets which China has increasingly dominated,” Freeman said, adding that markets in the Asia-Pacific region have been growing on their own and deserve the attention of US trade policy.
Freeman currently holds the Freeman Chair in China Studies at the Center for Strategic and International Studies.