The Biden administration announced after meeting with Chinese leader Xi Jinping during the Asia-Pacific Economic Cooperation summit that it had reached numerous agreements covering various topics ranging from fentanyl to artificial intelligence. As we know from previous experience, however, when is an agreement with China an agreement?
A major sore point for U.S. presidents across political parties and time stems from the Beijing regime’s seeming inability to adhere to any agreement that it reaches. Dating back to China’s World Trade Organization entry, presidents from George W. Bush to Joe Biden complained about China’s seeming refusal to adhere to agreements with the United States. As one negotiator put it about reaching an agreement with China, you don’t have a one-year agreement—you have 365 one-day agreements with China.
The United States may feel privileged that China treats all countries equally poorly. The Philippines manages a low-level conflict because of Chinese claims over islands inside the Filipino exclusive economic zone territorial waters. This follows the 2015 announcement by Xi with then-U.S. President Barack Obama that China wouldn’t militarize the South China Sea.
Even beyond Beijing’s inability to execute any agreement, the promise of an agreement becomes a negotiation tactic of potential change. Rather than committing to specific, concrete, deliverable outputs, Beijing, understanding the desperation of counter-party negotiators, agreed to form committees or working groups as the deliverable rather than concrete action. A related common tactic of Chinese negotiators demands a tangible, concrete concession in exchange for the creation of a joint working group with no tangible outcome. Still, Beijing traded a tangible concession for an intangible promise.
So, with the announcement of agreements stemming from the Biden–Xi meeting, what was actually achieved?
Very little.
The biggest announcement covered a long-standing U.S. complaint about China’s refusal to collaborate in stopping the flow of fentanyl into the United States. The Biden administration touted this “agreement,” but the only tangible outcome is the resumption of communication between U.S. and Chinese law enforcement. Even President Biden acknowledged that China promised the same in 2019 with no material change four years later. Notably, in exchange for the resumption of bilateral law enforcement communication, the Biden administration removed a Chinese police forensics institute from the entity list. So, in exchange for the tangible concession of removing a Chinese state institution linked to genocide in Xinjiang, the administration resumed talks with Chinese law enforcement. This doesn’t seem like much of an agreement.
Beijing sent out a public notice of its agreement with Washington that seemed reluctant at best and more intended to warn domestic producers about U.S. law enforcement than to crack down on domestic producers. The notice reminds residents of China about laws prohibiting the manufacturing of drugs while also urging Chinese producers to watch out for “‘long arm jurisdiction’ and ‘phishing law enforcement’ by overseas law enforcement agencies.”
Put another way, China announces no action but reminds domestic producers about its notoriously lax laws on fentanyl manufacturing and to watch out for those sneaky Americans. This seems like the exact type of deal we should expect.
Given a lengthy track record of not adhering to agreements, formal or informal, how should the United States and other countries approach either pushing China to fulfill agreements, enforce agreements, or raise disputes with Beijing?
First, impose tangible costs rapidly for not adhering to agreements. Whether it’s disputes with companies, hostage diplomacy, or state actions such as the South China Sea, China always attempts to persuade counterparts to delay imposing costs. This may come from counterthreats, promises to behave, or simply seeking further negotiations. However, the Chinese regime has a long history of never facing disciplinary action for its long record. As long as it knows that it won’t face tangible costs for its behavior, it has no incentive to change its behavior.
Second, deals should only be made as tangible-for-tangible swaps. The Biden administration traded the promise of the future benefit of cooperation for the tangible benefit of removing a Chinese state entity from a sanctions list now. Beijing has no incentive to cooperate and can delay at length. In this case, to trade tangible for tangible, the trade should demonstrate a clear pattern of cooperation and a drop in fentanyl production, after which the Chinese institution can be dropped from the sanctions list.
Tangible, verifiable behavior receives tangible, verifiable rewards. Because of the difficulty of reinstating sanctions, there’s a major asymmetry between providing them now with no assurances compared to removing them after verification.
There’s a cliché among the business elite in China that a deal isn’t done on a handshake after the contract is signed or even when the money is transferred, but only when the money lands in the offshore bank account. U.S. negotiators for the government or in business would be well served to remember what exactly an agreement means in China.
