This week, Project Syndicate catches up with Shang-Jin Wei, a former chief economist at the Asian Development Bank.
Project Syndicate: Last August, you wrote that “paradoxically, a downturn in America could help to improve bilateral economic relations with China” – a prediction that, you noted, was grounded in recent history. And yet, now that a downturn has arrived, US President Donald Trump has arguably become even more antagonistic toward China, calling the COVID-19 coronavirus a “Chinese virus” and accusing the World Health Organization of promoting “Chinese disinformation” about the virus. Why is this downturn – a global crisis – so far not spurring bilateral cooperation? Do you see hope for a reversal?
Shang-Jin Wei: My statement last August is based on history: in the past, when the United States has faced economic or social difficulties – such as after the terrorist attacks of September, 11, 2001, and the 2008 global financial crisis – its appetite for international cooperation has tended to rise.
Officials recognized that international coordination and cooperation can go a long way in supporting national recovery policies. That is why more than 90 US foreign-policy experts, including former high-ranking White House officials from Republican and Democratic administrations, recently issued a joint statement urging Trump to work with China to address the COVID-19 pandemic.
It is true, however, that since the 1990s, bilateral tensions have often risen in the runup to US elections, with political candidates from both parties competing over who is tougher on China. In the current election season, Trump has a particularly strong incentive to ratchet up the bilateral competition, in order to shift voters’ attention away from his administration’s failures in handling the pandemic. So we can expect more antagonism in the months ahead.
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We ask all our Say More contributors to tell our readers about a few books that have impressed them recently. Here are Wei's picks:
by Kai-Fu Lee
In painting a picture of what an artificial-intelligence-dominated world might look like, Lee both identifies reasons why China may take the lead and considers what it would take for the US to reclaim dominance.
From the PS Archive
Wei rebuts common arguments against the use of face masks by the general public. Read more.
Wei shows why American firms and households need China. Read more.
Around the web
Wei – together with Eswar Prasad, Kenneth Rogoff, and M. Ayhan Kose – examined economic policies that could help developing economies effectively manage the process of financial globalization. Read the paper.
As ADB Chief Economist, Wei described why Asia should welcome, not fear, a US interest-rate hike – a policy shift that now seems more distant than ever. Read the interview.