BEIJING — A few months ago, it looked like China’s economy would rebound quickly after being shut down to the world during Covid. Consumers were spending again. Exports picked up. Even China’s troubled housing market showed signs of stabilization.
It’s not like that. Official data released on July 17 revealed that the annual growth rate of the Chinese economy fell to just over 3 percent in the spring, well below the government’s goal.
Now the faltering economy appears to have helped spark a shift in Chinese officials’ willingness to engage in diplomatic talks with geopolitical rivals outside the country and to show greater openness in economic policy at home.
The shift is especially visible in China’s relations with the U.S. Despite several years of frayed ties and efforts to become less dependent on each other, the two countries remain closely linked economically, together accounting for two-fifths of the global production.
In recent weeks, China has hosted three high-level U.S. officials in Beijing, including John Kerry, President Joseph R. Biden Jr.’s climate envoy (although negotiations concluded without progress), and Treasury Secretary Janet L. Yellen.
And Chinese ministers planned to travel to Washington as the two countries had begun to address issues such as trade and climate change.
The Chinese government has also waged an effort to court domestic and foreign business leaders.
During the China Development Forum in March and continuing through the World Economic Forum in Tianjin last month, Li Qiang, the country’s Prime Minister, reiterated that China is open for business.
This month, Li met with China’s big tech companies to encourage them to hire more workers, in a sign that a nearly three-year effort to impose greater political control over the sector could be replaced by an emphasis on economic growth.
However, analysts noted that any softening in strategy remained limited to economic or political policies that do not involve China’s national security. And there are few signs that top leader Xi Jinping has endorsed a wholesale shift in policy toward the United States.
On July 15, China announced that it would conduct joint naval and air exercises with the Russian Army in the Sea of Japan. And Xi himself gave a speech on July 6 urging the military to “innovate” in war preparation, warning that “China’s security situation faces increasing instability and uncertainty,” according to the official Xinhua news agency.
China has also taken steps this month that could undermine its reputation as a reliable link in global supply chains. He declared he would limit exports of rare materials needed to produce semiconductors, in a step widely seen as retaliation for US restrictions on the sale of advanced semiconductors to China.
Some Chinese experts say they do not believe that China’s recent economic problems have limited the country’s approach to foreign contact.
Da Wei, the director of the Center for International Security and Strategy at Tsinghua University in Beijing, said the United States was unlikely to change its policies aimed at curbing China’s technological advances. Therefore, China has little incentive to make deals independently of broader economic issues, he explained.
The most recent data suggests that economic pressures in China could continue to interfere with geopolitical objectives.
China’s tilt toward Russia in the war in Ukraine has severely affected its relations with Europe. Chinese exports to the European Union fell 14.2 percent in June from a year earlier.
The Baltic countries—Lithuania, Latvia and Estonia, which are especially hostile to Russia—have abandoned China’s diplomatic process to negotiate with Eastern Europe. Lithuania has flirted with closer ties with Taiwan. China retaliated last year by sharply reducing trade with the three Baltic countries.
In recent months, China has sought to mend frayed relations with an even more extensive exchange of high-level visits with countries such as France and Germany.
It could be too late. On July 13, Germany called to reduce dependence on China and urged that country to stop using its economic influence in geopolitics. Germany also pledged close relations with the United States and urged China to distance itself from Russia.
By: KEITH BRADSHER
BBC-NEWS-SRC: http://www.nytsyn.com/subscribed/stories/6819252, IMPORTING DATE: 2023-07-25 22:20:07
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