US President Joe Biden has described China as a “ticking time bomb” due to its economic challenges, saying that the country was facing problems such as weak growth, high unemployment, and deflation. He also criticized China’s Belt and Road Initiative and its investment in sensitive technologies, but said he did not want to hurt China or start a fight with it.
China’s economy is slowing down
Biden made his remarks at a political fundraiser in Utah on Thursday, where he said that China was “in trouble” because of its economic situation. He said that China had the “highest unemployment rate going” and that its workforce was ageing. He also misquoted the country’s growth rate, saying that it was 6.3% in the second quarter, while it was actually 7.9%.
However, Biden was right to point out that China’s economy has recovered more slowly than expected since the Covid-19 pandemic. The country’s consumer price index, the main gauge of inflation, fell 0.3% in July, the first negative reading since early 2021. This raised fears of deflation, which could hurt consumer spending and business investment. China also reported an unemployment rate of 5.2% in June, higher than the 3.6% in the US. China is struggling in particular with youth unemployment, which reached a record 21.3% in June.
China’s Belt and Road Initiative is a “debt and noose”
Biden also slammed China’s Belt and Road Initiative (BRI), a global infrastructure program that aims to connect Asia, Europe, Africa, and Latin America through roads, railways, ports, and power plants. He said that the BRI was a “debt and noose” for developing countries that often take on large loans in exchange for Chinese investment. He said that the US was offering a better alternative for these countries by providing clean energy, health care, and education.
Biden’s criticism of the BRI echoed the concerns of many analysts and policymakers who have warned that the BRI could create debt traps, environmental damage, and political influence for China. Some countries, such as Malaysia and Pakistan, have renegotiated or canceled some of their BRI projects due to financial or security reasons. However, China has defended the BRI as a win-win cooperation that benefits both sides and promotes global development.
China’s investment in sensitive technologies is a challenge for the US
Biden also mentioned China’s investment in sensitive technologies such as computer chips and artificial intelligence (AI), which he said posed a challenge for the US. He said that he had signed an executive order on Wednesday that would restrict US investment in some high-tech industries in China. He said that this was necessary to protect US national security and competitiveness.
The executive order expanded a previous ban imposed by former President Donald Trump on US investment in Chinese companies that are linked to the military or surveillance sectors. The new order added more companies to the blacklist, including some that are involved in semiconductors and AI. China expressed its “grave concern” over the order and reserved the right to take countermeasures.
Biden does not want to hurt China or start a fight with it
Despite his harsh words on China’s economic challenges, Biden said that he did not want to hurt China or start a fight with it. He said that he wanted a rational relationship with China based on mutual respect and cooperation. He said that he had spoken to Chinese President Xi Jinping several times and that they had agreed to work together on some issues such as climate change and nuclear proliferation.
Biden’s remarks reflected his administration’s strategy of engaging with China on areas of common interest while competing with it on areas of divergence. The US and China have held several high-level meetings this year to discuss their bilateral relations and regional issues. However, they have also clashed over human rights, trade, cybersecurity, Taiwan, Hong Kong, and the South China Sea.
