Beijing likely to retaliate, but analysts unsure of how far U.S., China will go in consulate fight

The relationship between the U.S. and China may continue to worsen after the State Department ordered Beijing to close a consulate in Houston, making it “almost certain” the Asian country will retaliate, experts said on Thursday.

U.S. officials said the move was made to protect American intellectual property and “private information.” 

The dramatic event on Wednesday came after recent tumultuous developments between the world’s two largest economies. On Tuesday, the Justice Department claimed that two Chinese citizens had tried to steal trade secrets by hacking into firms working on a vaccine for Covid-19. 

The FBI also alleges that a researcher focusing on biology who lied about her connection to the Chinese military in order to receive a U.S. visa has avoided arrest by taking refuge in the Chinese consulate in San Francisco, according to a July 20 court filing. 

Domestic politics in the U.S. ahead of the presidential election in November could have played a part in the closure order, said Orville Schell, Arthur Ross director of the Center on U.S.-China Relations at the Asia Society.

“The president is bent on blaming China — and not without some justification — for the virus, but I think the failure of the United States to be able to bring the virus under control has meant that he does wants to emphasize its source, namely China,” said Schell.

“This is where our foreign policies then get interlocked with domestic issues, namely the elections. So, that is alarming,” Schell added.

But there are still ample reasons for the U.S. to seek a more balanced, reciprocal and equitable relationship with China in many areas such as trade and intellectual property, issues other countries also have with Beijing, said Schell.

How the rhetoric and narrative surrounding U.S.-China relations evolve will depend on who the American president will be a year from now, said Robert Daly, director of the Wilson Center’s Kissinger Institute on China and the United States.

But “it’s almost certain China will retaliate” for the U.S. move against its consulate in Houston, which is “the beginning of a dramatic escalation in tension” and is more serious than retaliatory journalist expulsions, said Daly.

Schell said the closure order is one that “gets us a giant step closer to at least the withdrawal of ambassadors” or something similar.

Article source: https://www.cnbc.com/2020/07/23/analysts-are-unsure-of-how-far-us-china-will-go-in-consulate-fight.html