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Clash Of The Superpowers Ameri Episode 1 Engsub
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00:04Xi Jinping and Donald Trump the leaders of the world's most powerful countries are locked in a
00:11high-stakes battle for global power and influence it's a fight that's threatened to explode since
00:19Trump first took office tore up the diplomatic rule book and smashed the consensus on free trade
00:26we lose almost 500 billion dollars a year with China and we want to know what's wrong with us
00:34we are about to help President Trump affect the biggest shift in U.S. foreign policy since the
00:40end of the Cold War now with both sides staking their claims on different parts of the world
00:46this is the story of how these two superpowers have become tangled in a struggle for economic
00:51supremacy with repercussions everywhere we have to realize there's this crisis and we have to take
00:58action to change the alternative is total defeat we'll hear from top U.S. officials and Chinese
01:06academics who give the inside track from Beijing when the president's off the handle you don't know
01:14what's going to happen as well as those caught in the middle of this dangerous standoff the message
01:21from the White House was the president of the United States wants you to choose and he wants you to
01:27choose America
01:46a few days before Donald Trump was first sworn in as president Xi Jinping headed to the Swiss Alps
01:54the leader of the world's largest communist country was there to join the business and political
02:00elites at the annual world economic forum this is first time president Xi attended so China want to
02:10make a clear point where we stand on international economic system
02:19Davos is an extraordinary environment it's jammed solid with the world's political leaders bankers financiers
02:29this year in particular was extraordinary because Trump was about to be inaugurated and many of us were quite alarmed
02:42we had never seen a politician like Trump nobody know his quality how he operates
02:50Trump was clearly turning his back on free trade and open markets the traditional American mantras that
02:59had led the free world for for decades and then enrolls president Xi in a magnificent piece of theater
03:08and delivers a speech which says essentially I am the custodian of free trade and open markets
03:40I never thought in my lifetime to see a communist leader actually to defend the free trade
03:46but remember free trade is good for China the other thing is to remind Trump that this is your system
03:54you created to benefit you and also benefit the rest of the world
03:58so you better keep it don't abandon the ship you are the captain
04:06people didn't know whether he was taking the mickey a little bit at first it was such an extraordinary counterintuitive
04:15speech for Xi to be making
04:18follow me work with me to ensure that we don't allow anyone in brackets incoming U.S. President Trump
04:26to trample down this magnificent free trading structure that has made us all so much more prosperous
04:37he saw an opportunity and he took it it was a brilliantly crafted intervention and it completely stole the show
04:46Xi was the toast of Davos
04:50Quite a journey for a man who'd become leader of the Chinese Communist Party
04:55the CCP only four years earlier
05:03he'd take an office promising to build on a booming economy and to reclaim China's centuries-old place as a
05:10leading nation of the world
05:12he called his vision the Chinese dream
05:28The Chinese dream is that China will restore its previous position
05:36It's not China will dominate or try to take over the world
05:43In the West the press call it rise of China which is a total misnomer
05:50Xi make a point saying this is a restoration not rice
05:55Please welcome the next President of the United States Mr. Donald J. Trump
06:02Now Trump was heading to the White House with his own promise to make his country great again
06:09His victory followed a campaign where he put China front and center of his foreign policy
06:15In his own unique style
06:17We can't continue to allow China to rape our country and that's what they're doing
06:24It's the greatest theft in the history of the world
06:30One of the first times I briefed President Trump was during the campaign
06:35I get about four sentences into my briefing my brilliant briefing on China
06:39And then Donald Trump with like a staccato approach starts firing questions at me
06:46What's China's GNP?
06:48What's the trade and balance between the United States and China?
06:51Is there military any good?
06:54And then I realized he cared about the balance of payments
06:59He knew about tariffs
07:01He understood the business aspect of the relationship
07:07For many decades we've made other countries rich
07:11While the wealth strength and confidence of our country has dissipated over the horizon
07:19The USA! USA! USA! USA! USA! USA!
07:22He paid attention to a group of people
07:24What we call rule of Rust Belt
07:25The former manufacturing power of the United States
07:28He was the only candidate who recognized their legitimate pain
07:31And the only candidate who had a solution
07:33which is we're going to go and renegotiate all those trade deals with China
07:38Together we will make America great again
07:43Thank you, God bless you, and God bless America.
07:56I remember walking into the executive office building
07:59one day into the Trump presidency,
08:01and there's a big sign that lists all the meetings
08:05that are being held.
08:06And one of the titles is something like,
08:08let's talk about greater U.S.-China economic integration.
08:11This is a day into the Donald Trump administration,
08:14and he's just won an election
08:16with a significant part of his agenda
08:19being to fight off China's economic predation.
08:23And people in his bureaucracy, in his building,
08:26are having meetings
08:28about how we could do more economically with China.
08:32I was surprised by some of the assumptions
08:35that were being presented by long-time diplomats,
08:40long-time intelligence officers and others.
08:44There was a view that really all that Beijing wanted
08:47at the end of the day was just to access
08:49a large American market and to prosper and thrive
08:53in a U.S.-dominated world order.
08:58I thought that those assessments were out of date,
09:02to put it mildly.
09:04In the 80s and 90s,
09:06the Chinese Communist Party had opened the country
09:09to Western markets,
09:10part of what they called socialism with Chinese characteristics.
09:16The country enjoyed unprecedented growth,
09:19which was given a huge boost in 2001,
09:22when China was welcomed into the WTO,
09:24the World Trade Organization.
09:29It defined China as a developing economy,
09:32meaning trade rules were applied more leniently,
09:35while the world's biggest companies
09:37continue to flood into the country.
09:41I was there as a reporter for Reuters news agency,
09:46all the way from the late 90s until 2005.
09:50It was a heady time.
09:52It was hard not to feel optimism that China would continue opening up,
09:59that its marketization would continue.
10:04And there was a hope the politics would begin to moderate as well.
10:09But by the time I left,
10:12I had this sinking feeling that many of those optimistic assumptions
10:17were going to be dashed.
10:22I think China entered the WTO with a really good deal.
10:27They got the benefits of participating in a global trading system
10:31in which there were rules and norms,
10:34but it was given a special carve-out
10:36where it could pretend that it was a developing country,
10:39which I think is always tough
10:42when you're one of the world's largest consumers
10:44of Ferraris and Lamborghinis.
10:46It's entirely logical and sort of expected
10:50that Beijing would want to maintain that system.
10:56Coming into the White House,
10:58Trump's team included hawkish advisers
11:00who wanted to ensure the new president would deliver
11:03on his promise to take on China.
11:05But they knew that for all of Trump's tough talk,
11:08he had a reputation to protect as a champion of business.
11:13And he wanted to keep the CEOs on side,
11:16many of whom had moved manufacturing to China.
11:22In the White House, we had the two camps start to develop.
11:25The more globalist establishment camp
11:29and more the kind of disruptors, populist, nationalist camp.
11:34The biggest fights were about China and trade.
11:37And that's because the reason is we had so many Wall Street guys.
11:41And look, I worked at Goldman Sachs.
11:43We had Goldman Sachs guys in there.
11:45Goldman Sachs and Wall Street is the investor relations partner
11:49for the Chinese CCP, this radical cadre that runs China.
11:55Chief amongst the Wall Street faction was Gary Cohn,
11:59the former president of Goldman Sachs and Trump's choice
12:03as his top economic adviser.
12:05As a market practitioner, I think that we can have
12:10a globalised world that works well.
12:14You want to expand your plant?
12:16Or when Mark wants to come in and build a big massive plant?
12:20Or when Dell wants to come in and do something monstrous and special?
12:27You're going to have your approvals really fast.
12:28Thank you, sir.
12:30The question is can we both be complementary to each other?
12:34I think the answer is yes.
12:38Whether the Hawks or the globalists would have their upper hand
12:41would be put to the test at Trump's first summit with Xi.
12:46As he got ready, the U.S. president was briefed
12:50by his national security adviser.
12:53President Trump is kind of reflexively contrarian.
12:56And because he's reflexively contrarian,
12:59if you advise President Trump and say,
13:01hey, everybody agrees, this is what you should say,
13:04he might just say the opposite to spite everybody.
13:07So what we decided is what we would emphasise with President Trump
13:11is what Xi Jinping wants him to say.
13:13And let President Trump be contrary to Xi Jinping
13:16rather than to his advisers.
13:23What we said to President Trump is how Xi Jinping uses this language
13:27that sounds nice or at least innocuous.
13:30And when the Chinese Communist Party officials say win-win,
13:32what they mean is they win twice.
13:36Xi arrived in America hoping Trump might back down
13:39from the aggressive threats of his campaign.
13:43You know, for people in China, basically we know every election
13:47there's always a bashing China element somewhere.
13:50A lot of name-calling, a lot of blaming.
13:53I think also the advisers that he's using at that time
13:56was very hawkish, like Steve Bannon, Matt Partinger
13:59and all those people.
14:01But then normally when the new administration come into the White House,
14:05it becomes more, you know, pragmatic.
14:09President Xi attached great importance to the personal relationship.
14:14His personality is, he's very easygoing.
14:19He wants to make friends.
14:22And when he recognised the other side as a friend,
14:25I think that will be very helpful for the bilateral relations.
14:31Trump had chosen to host Xi not at the White House
14:34but at his Palm Beach resort, Mar-a-Lago.
14:39President Trump, he fancies himself as a great negotiator.
14:43And part of that is separating the relationship
14:45from the tough issues you're negotiating.
14:48Thank you, President. Thank you.
14:50He's in the hospitality business.
14:52He had his granddaughter, was learning Chinese.
14:56I wanted to make you feel at home.
14:58I wanted to make you feel at home.
14:58I want to thank you.
14:58I want to thank you, President.
14:58I want to sing a Chinese folk song.
15:05This is a great move.
15:07It's very positive.
15:09It's like a family reunion.
15:16One of the biggest parts of Mar-a-Lago was time set aside for the two heads of state to
15:24be alone
15:24one-on-one. The two spent a vast amount of time together. And the main message the president
15:31was delivering to us is that, you know, he and she were hitting it off.
15:38It seems they like each other. Yeah, chemistry is good.
15:44We've had a long discussion already. And so far, I have gotten nothing, absolutely nothing.
15:53But we have developed a friendship. I can see that. And I think...
15:57You know, President Trump, he's a New Yorker. I'm a New Yorker. And New York men of that certain age,
16:03they tend to say, he's my best friend. He's a pal of mine.
16:07And they were not really friends. They've just met each other.
16:09And they probably have business interests together. But it doesn't mean they're golf buddies.
16:13So when President Trump says, oh, he's my friend, I think what that meant is that President Trump met him.
16:18He understands how he's going to negotiate with him.
16:20Thank you, everybody. Thank you very much.
16:27She wasn't only relying on his budding relationship with Trump.
16:32He'd long been working to ensure China would be at the center of global trade, with or without America.
16:41A month after Mar-a-Lago, he played host to leaders from around the world to celebrate his flagship initiative.
16:49Belt and Road.
16:58Harking back to the ancient Silk Road between East and West,
17:03Belt and Road aimed to better link China with the world,
17:06financing huge infrastructure projects.
17:11One of the most ambitious schemes ever conceived.
17:15It spanned continents with over a trillion dollars spent.
17:21Showcasing China's ability to deliver world-leading feats of engineering.
17:27Now Xi put on a summit befitting its scale.
17:32The Chinese do know how to put on a show.
17:35The biggest rooms you've ever seen.
17:37Vast banqueting tables.
17:39You know, more flowers than they've got in Kew Gardens.
17:42To invite President Xi to the podium.
17:46President Xi decided to make a Belt and Road Summit to assure the world
17:50if the U.S. is back to the protectionism,
17:54China is still there to help and to work with everybody.
17:57Can be.
17:59Well, the road is important in the demonstrating to the American president
18:04or American government
18:07that China could have alternative
18:11if Western countries decide to block or slow down Chinese economic activities.
18:26Cutting a somewhat lonely figure at the summit
18:28was the U.S. representative Matt Pottinger.
18:32One of the things that Beijing does
18:34is to try to create the sense that the Communist Party's success is inevitable.
18:40So come jump on the bandwagon.
18:45They wanted to assemble as many world leaders as possible
18:48to essentially endorse Belt and Road.
18:54I remember speaking to President Trump explaining that Belt and Road was actually a system
19:00designed to diminish the influence of the United States.
19:05It was an extremely opaque system
19:09whereby governments would have to surrender sovereignty over critical infrastructure
19:17as collateral in case they weren't able to pay back debts.
19:22And so it was really sort of a form of loan sharking on a global scale.
19:29Pottinger's line didn't go down well with the other attendees.
19:33One of them was Kenya's president,
19:35whose country had just that month opened a multi-billion dollar new railway,
19:40largely financed by China.
19:43Kenya took a big loan to build the Standard Gauge Railway,
19:48and it was never going to be easy paying it.
19:51But was there a Chinese debt trap? No.
19:55African countries are caught in a debt trap,
19:57but it's not of Chinese making.
20:00The predominant amount of money owed by African states
20:04is owed to Western governments and private banks.
20:09The Americans were uncomfortable with any Chinese initiative
20:12that looked as though it had a strategic dimension.
20:15And this clearly was a strategic project.
20:18It was about projecting Chinese influence,
20:21securing Chinese supply lines,
20:23and securing export routes as well.
20:27The same day that Xi was hosting his guests in Beijing,
20:32Trump's new trade representative was being sworn in.
20:38Robert Lighthizer had spent years accusing China of breaking trade rules.
20:42Thank you all very much for being here.
20:44I'm very grateful for your friendship.
20:46He quickly summoned top officials to the West Wing.
20:50The senior people were there.
20:52And a lot of them were in the direction of,
20:54well, we have to have dialogue,
20:56we have to tell the Chinese what we want,
20:58all these kinds of things.
21:00You know, I said, you know, I don't agree with any of this.
21:03The Chinese game plan has been dialogue, dialogue, dialogue,
21:08talk, talk, talk, talk, talk, and then don't do anything at all.
21:14Lighthizer's strategy was to tax goods coming to the US from China.
21:18He's got a very, very good chance of happening.
21:19But his plans ripped open divisions with the Wall Street faction in the White House.
21:25I wanted tariffs on as much as we can to change the economic relationship
21:30between the United States and China,
21:32to force companies to come back to the United States
21:34or to find other places to manufacture.
21:37But there was an organized group who's against tariffs.
21:43I thought there was more question to who we were hurting
21:47and who we were helping by putting tariffs on.
21:52Lighthizer started to get to the president and say,
21:55Mr. President, your voters, the people who trusted you,
22:00expect that this is going to get done.
22:03It's not getting done not because you don't want it to get done.
22:06It's not getting done because people on your team
22:09are deliberately obstructing your order to bring China to account
22:14for what it's done to the American people for 30 years.
22:17And the president said, I'm not going to let people delay anymore.
22:25Trump gave Lighthizer the green light to launch a major investigation
22:29into China's trade practices.
22:31Thank you very much, Ambassador Lighthizer.
22:34Especially claims it was forcing US companies to give up blueprints
22:38for their most valuable technology.
22:40We're going to be fulfilling another campaign promise
22:44by taking firm steps to ensure that we protect the intellectual property
22:49of American companies and, very importantly, of American workers.
22:54American companies were desperate to do business in China.
22:57And the Chinese would say, you can enter the Chinese market,
23:00but you have to allow us access to your proprietary technology.
23:05Well, when American companies did that, very quickly they found
23:09that that technology belonged to their Chinese partners.
23:12And then they would go flood the market with these products
23:16at a much cheaper rate, put American businesses out of business,
23:20and dominate the global supply chains.
23:25The investigation could pave the way for wide-ranging tariffs on China.
23:32Economists believe that tariffs are going to raise prices and lead to inflation.
23:37Even if you bought the idea, what's the alternative that we teach our children Chinese
23:44and tell them to prepare for a life of servitude?
23:48We have to realize there's this crisis and we have to take action to change.
23:53And if there's some small cost associated with it,
23:57the alternative is total defeat, and that's not an option.
24:05In Beijing, Xi was showing no sign of making concessions.
24:12Although China's phenomenal growth was slowing,
24:15his ambition remained resolute.
24:28In a three-hour speech to the annual party congress,
24:32he described 5,000 years of China's great imperial past,
24:38before the century of humiliation that started with the opium wars of the 19th century.
24:53Chinese Chinese economy was 32.5% of global GDP.
24:59When communists took over in 1949, Chinese economy less than 2% of global GDP.
25:06That is a freefall disaster.
25:09At the time Xi Jinping announced the China Dream, we are about 12% or 15% of GDP,
25:17which means if you compare with the 1830s, we still have a lot of room there.
25:25Three weeks later, Trump arrived in Beijing for what the Chinese were calling a state visit plus.
25:33With the threat of tariffs looming large, this was a chance for Xi to win round the US president.
25:41Xi wanted to make it as spectacular as possible, for obvious reasons.
25:49Everybody knows that Trump liked spectacle.
25:55He likes, well, being treated like a king, maybe.
26:02We talked to President Trump about the images that Xi Jinping would try to create.
26:07He would try to make it seem like the leader of the free world, President Trump,
26:12was coming to Beijing to kowtow, you know, to the emperor, you know, Xi Jinping.
26:23He would try to make it seem like the leader of the free world, the emperor of Rome,
26:29and you want to impress somebody. What would you do?
26:34It was everything you could imagine.
26:39Everything from music, to singing, to dancing.
26:47They really pulled out all the stops and it was impressive.
26:55Perhaps most extraordinary, Trump was invited to dine in the Forbidden City.
27:04Forbidden City means forbidden. Historically, this is a residence of emperor.
27:12This is an extraordinary honour. Chinese are not even allowed to go.
27:19So it's quite amazing to treat Trump that way.
27:23That's something. We're having a great time. Thank you.
27:27I don't believe Putin even get that treatment.
27:31Earlier that day, Xi had even given Trump a personal tour.
27:36But not everyone was welcome.
27:40As President Trump was about to be escorted through the Forbidden City,
27:45before I understood what was happening, I was diverted before I could get into the gate.
27:52Matt Ponger is like the man who knew too much, you know, and he really would make
27:57the Chinese leadership very uncomfortable. I mean, there's a guy who's fluent in Mandarin,
28:01and knew the Chinese Communist Party so well. When we get to the Forbidden City, I'm looking around,
28:08where's Matt Pottinger? He's not there. The one guy who can actually speak the language
28:13and know something about this system has somehow been kept out.
28:22The imperial setting was the perfect spot for Xi to give Trump an education on China's historic place
28:29in the world. And I guess the oldest culture they say is Egypt at 8,000.
28:36Yeah, 8,000.
28:37Iji, Iji, Iji, Iji.
28:38But, now, the culture has never been stopped. It's just been傳統, only China.
28:46So, this is your original form, right, Jeff?
28:49Oh, yes.
28:50It's a reality one time.
28:52So, we're actually the people.
28:54And people like us, we'll be traced back to 5,000 years ago.
29:00We call ourselves the people going down from France.
29:10Xi's charm offensive looked to be working,
29:13as the leaders and their team sat down in the great hall of the people.
29:17Our meeting last night was absolutely terrific.
29:23Our dinner was beyond that.
29:27Then, Trump turned to his team.
29:30The president, after the first two or three statements, asked me to address the trade issue.
29:38I didn't have a script. I didn't know for sure that I would be called on.
29:43Lighthizer is really the trade war warrior for many, many years, so Chinese know that.
29:50His basic argument is familiar, but the way he presented it is quite,
29:56I would say, quite aggressive from a Chinese point of view.
30:01Lighthizer couched his presentation around the practices of forcing the transfer of intellectual property.
30:08So, he just went through many of these practices with such clarity.
30:12I think it was arresting to Xi Jinping and the other officials there.
30:18I basically made the argument that we were the victim here.
30:22It wasn't China, and it can't continue and it won't continue.
30:27And I think that was a little befuddling, like, what's going on here?
30:35But the Chinese hosts weren't done yet.
30:39Trump had traveled to Beijing with dozens of American business leaders in tow.
30:44In front of the cameras, they signed more than $250 billion worth of deals with China.
30:55China was quite generous to really make all those things happen.
31:01Shows that China is really willing to collaborate with U.S.
31:04Dallas, the president and CEO of Boeing commercial airplanes and Mr. Jia Baojun.
31:08That was really a big boost for President Trump.
31:11And he really had a big harvest for his first trip to China.
31:16Donald Trump wanted to show the American people that
31:19during his visit to China, he got something for, you know, America.
31:24And this was something really tangible and right in his wheelhouse.
31:30Now Trump had his chance to talk directly to the press.
31:34I don't blame China.
31:41After all, who can blame a country for being able to take advantage of another country
31:49for the benefit of its citizens?
31:51I give China great credit.
31:55He turns to Xi Jinping and goes, for all this here, I don't blame you. I blame us.
32:01But in actuality, I do blame past administrations for allowing this out-of-control trade deficit
32:10to take place and to grow.
32:11It was very Trumpian in that it was simultaneously gracious to the host, but also had a sharp edge to
32:19it.
32:20In spite of all the flattery and the rest, he was not going to back off his demands
32:24for a really significant shift in that economic relationship.
32:28When that shift did not materialize, President Trump resorted to a trade war.
32:34Here's what's on the power lunch menu. President Trump hitting China
32:37with $60 billion worth of tariffs, raising fears about a global trade war.
32:43In March 2018, Lighthizer's report was published.
32:47It says the economic harm to the U.S. of unfair trade practices on intellectual property
32:52is in the range of $50 billion. And so it plans to try to recoup some of that cost with
32:58these tariffs.
32:59Trump announced tariffs on Chinese exports, particularly those the U.S. said use stolen technology.
33:08China would respond in kind, sparking a tit-for-tat escalation that spiraled over the coming months.
33:15If they charge us, we charge them the same thing. That's the way it's got to be.
33:22Trump was smashing decades of Washington consensus on trade.
33:27Earlier that month, Gary Cohn resigned.
33:30The only thing the tariff was doing was acting as a consumption tax
33:39to the U.S. consumer that bought that good from China.
33:45I can remember talking with business leaders and investors and many folks assuring me that
33:51there's no way these tariffs could stay on more than three or four months.
33:55Because it would be too harmful to the U.S. economy.
33:59And I can remember telling folks that I think we're actually much more in a new normal.
34:04Just because they have a business model that works really well,
34:07that the rest of the world should just stay static so that they can benefit from that,
34:13isn't a realistic perspective to have. And that's tough to hear, particularly
34:18when you're a powerful company, you've been kind of a master of the universe.
34:23But that's the reality.
34:26Trump's team now had to face officials from Beijing.
34:30The Chinese really were taken aback. They didn't think that Trump would really go ahead with the
34:37tariffs. They had a sense for a long time that it was a bluff.
34:43You know, they had signed this $250 billion worth of deals just back in November.
34:48You know, that was a serious amount of money. And they thought, you know,
34:52they had done the necessary and didn't understand why, you know, it wasn't working.
35:01As America and China braced for what could be a costly trade war,
35:07Xi put on a show of strength.
35:08Xi put on a show of strength.
35:10Within weeks of the tariffs being announced, he donned military fatigues to preside over
35:15a massive naval parade, the largest of its kind ever conducted by the Chinese.
35:22It took place in the South China Sea, a crucial shipping corridor where China
35:27was building artificial islands to back up its claims on the area.
35:32Claims rejected by most countries, including the US.
35:37He says he wants a modernized military by 2035. He wants a world class military by 2049,
35:46which means pretty much he wants to displace the United States from the Indo-Pacific.
35:51They want to defend all the waters surrounding China and manage the trade
35:55and everything passing through them. This was China interrupting and trying to change
36:01international rules and norms that we felt that we couldn't tolerate.
36:06The situation was becoming more and more dangerous as US ships and aircraft
36:12continued what they called freedom of navigation exercises.
36:17U.S. military aircraft, Powerade Alpha. This is Chinese U.S. Reef. China had
36:23sovereignty of the national islands including U.S. Reef and its adjusted waters. Leave immediately
36:27and keep far off so that avoid enemy standing.
36:37Tensions were high as world leaders arrived in Argentina for the annual G20 summit.
36:44It would be Trump and Xi's first meeting since Beijing.
36:49The U.S. President had a new national security advisor.
36:54I thought this was obviously a significant opportunity to make points about things that
37:02concerned us about China's aggressive behavior along its periphery and talk about the big strategic issues.
37:09What Trump mostly wanted to talk about though was trade.
37:15By now, the U.S. had ramped up tariffs to hit $250 billion worth of Chinese goods.
37:24Trump was threatening to go even higher.
37:28But Bolton feared the prospect of a trade deal with China might soften Trump's resolve.
37:37The two leaders met for dinner on the sidelines of the summit.
37:42This was the first time I had seen them together. It was unnerving to watch Xi in a very systematic,
37:52thorough way advance what were clearly his well thought out objectives and to watch Trump wing it.
38:00The relationship is very special, the relationship that I have with President Xi.
38:13Xi had come to the meeting with a headline-grabbing pitch.
38:17If the U.S. would hold off further tariffs, China would commit to buying U.S. goods and services
38:23worth over a trillion dollars.
38:27Chinese site, for example, Walmart and other successful retailers, how they're successful
38:34because of Chinese made in China. So that is what the argument they are making,
38:40saying you might end up hurting yourself.
38:45I was worried throughout the dinner that we were basically going to agree to things.
38:49And indeed, Trump did make concessions in terms of not putting tariffs in place that he had threatened
38:55so that we could have good trade discussions with China.
39:00A truce in the trade war was agreed.
39:06But just then, news came through that had the potential to undermine any goodwill.
39:12I hear my phone ringing. I look down and it's my colleague at the Justice Department.
39:18And I don't normally get calls from the Justice Department.
39:22And he informs me that they're going to exercise an arrest warrant against the chief financial
39:27officer of Huawei as she goes through at Vancouver Airport.
39:31I immediately think about how this is going to be interpreted as a deliberate snub and a deliberate
39:37affront to the Chinese counterparts. And how this will throw a wrench into what the president is
39:45trying to achieve. And let's get back to the big story this morning, weighing on futures,
39:48with big implications for the U.S.-China trade truce and relationship.
39:51Canada has arrested the CFO of Huawei, who also happens to be the daughter of the company's founder.
39:56Meng's charges were part of a sweeping set of criminal charges by the Trump administration
40:00unveiled yesterday, accusing the company of stealing trade secrets and violating sanctions.
40:06We all hear news, we were surprised, because while we're shaking hands on the table,
40:12the U.S. is kicking us back under the table.
40:17We knew for some time before that Meng was coming, it was imperative that not leak out.
40:25John Bolton had been told that Meng's arrest was imminent just before the dinner with Xi.
40:31He decided not to inform Trump until it was made public.
40:36On the flight back to Washington, I explained what had happened in Canada and what would flow from that.
40:43He didn't really have much of a reaction to Meng's arrest when I briefed him on it.
40:49Officially, the Chinese government isn't directly linking Meng's arrest to the trade negotiations just
40:56yet. But unofficially in the state media, this is being seen as a political decision.
41:06Trump had a Christmas dinner in the East Room for his top White House staff. And at one point,
41:13out of nowhere, he said, by the way, why did we arrest Meng, the Ivanka Trump of China?
41:20I thought maybe first I would say, you didn't tell me that Ivanka was a spy and an agent of
41:27our government.
41:27But I didn't, fortunately for me, probably.
41:32итесь with them out and on.
41:33Telecom's giant Huawei was a shining example of Xi's vision for China to dominate technologies
41:39of the future.
41:40It had become a battleground with the Americans
41:43who placed restrictions on the company,
41:46citing fears China could use its equipment for spying.
41:51Meng's high-profile arrest only raised the tensions.
42:14With relations between the superpowers deteriorating,
42:17other countries were finding themselves caught in the crossfire,
42:21and not just over Huawei.
42:24The British Chancellor got a taste of this
42:27when he addressed that year's Belt and Road Forum.
42:31The speech lauded the scale and ambition of the project
42:36and the Chinese delivery of it.
42:39But said explicitly that if this is going to work,
42:41it's got to be very careful about the debt burdens
42:44that recipient countries are taking on.
42:48I was invited to the Heads of State lunch,
42:52which was hosted by President Xi.
42:54And he just lashed into me,
42:57saying this was none of my business,
42:59and the Belt and Road was China's project,
43:04and China would run it in the way that China chose to run it.
43:07So it was quite a moment being given a finger-wagging lecture
43:12by President Xi.
43:16Returning to London,
43:18Hammond would find that the fallout wasn't over.
43:22So I get a call from the White House.
43:25I get the Deputy National Security Advisor on the phone,
43:29and he says,
43:31we'd like to talk to you about your speech.
43:33We had seen a speech that Philip Hammond had just delivered
43:37that it appeared to be an endorsement of China's debt trap diplomacy.
43:43So it was a bit cheeky,
43:45but one of my colleagues from the State Department
43:47printed out Hammond's speech on a poster board
43:51with some of the key phrases
43:53that looked like they'd been taken straight
43:56from Beijing's propaganda highlighted.
43:59A meeting was set up,
44:01and somebody came over
44:02and arrived in my office in number 11.
44:05He laid them out in my office in Downing Street
44:11along the wall
44:12so that all the text of the speech was there,
44:15and I was asked by the Americans
44:16to justify the...
44:20or to explain my thinking
44:23behind the less critical parts of that speech.
44:27I'd said from the outset,
44:30the UK cannot be in a position of having to choose
44:34between the world's largest economy
44:36and the world's second largest economy,
44:38and that was what I told the Americans.
44:41The response I got was,
44:43that is exactly what the President of the United States
44:47wants you to do.
44:48He wants you to choose,
44:49and he wants you to choose America.
44:56Trump now ramped up the pressure even more.
44:59He signed an executive order
45:01preparing the ground for a total ban
45:03of Huawei equipment in U.S. systems.
45:07And the Americans set to work
45:09persuading other countries to follow suit,
45:12beginning with their closest ally.
45:17We had to start with the UK
45:19because in many ways,
45:20the UK's position as sort of a cyber security
45:23and telecommunications power, GCHQ,
45:26is seen as sort of world class,
45:28and that was allowing everybody else
45:31to essentially point to and say,
45:33well, GCHQ says it's okay,
45:34so why are you, America,
45:36making a big deal about this?
45:42The position of the British government
45:44was very strongly against making
45:46any significant changes to Huawei,
45:50and we met with a lot of resistance.
45:52Philip Hammond, the Chancellor of the Exchequer,
45:54and others were very strong on that.
45:59The message from the White House
46:01was we want Huawei out.
46:04Get it out and tell these Europeans
46:06that they've got to toe the line.
46:09The Chinese had made this a totemic issue
46:13that if we cut Huawei off,
46:15there would be significant trade
46:18and other consequences.
46:21So we're very much squeezed in the middle.
46:26As Trump arrived for a long-promised state visit,
46:30the Brits hoped to convince the Americans
46:32that they could keep Huawei
46:34out of the most sensitive parts of their network.
46:39Our security experts essentially said
46:41we've engineered the systems in a way
46:43that the Americans are overstating the risk.
46:47We had very deep concerns
46:50and plenty of evidence
46:52that there were back doors,
46:54there were software and hardware vulnerabilities
46:57that would make it fairly easy
46:59for data to be siphoned out of those networks.
47:04They thought they could protect telecommunications in Britain,
47:07and we simply didn't agree with that.
47:10There was this tension between our security experts.
47:14Ours were clear that we could manage any risk from Huawei.
47:19It was never in the core of our infrastructure,
47:21only in the periphery.
47:23And they didn't agree.
47:25Our main point is that this is not a technical discussion.
47:30This is a policy discussion, right?
47:32We felt that they simply did not want to re-examine the decision
47:36because changing their decision that they had made before
47:40would likely entail retaliation by Beijing.
47:45We explained to Trump how our network
47:47was configured differently from the American network,
47:50that we were very confident that what we had was a robust system,
47:55but he was not listening.
47:57In fact, most of the time when you engaged with the president,
48:01there was no sense that he was actually listening
48:04to what anybody else was saying.
48:05He was simply preparing for the next sentence
48:09that he was going to say.
48:12We said to each other that this is a foretaste of Huawei.
48:15We're going to be here a lot in the future.
48:18We're going to find plenty of issues
48:20where the Chinese are squeezing us from one side
48:22and the Americans from the other.
48:24Not just the UK, but all the middle-ranking powers.
48:31The Brits stood firm on Huawei for now.
48:35It was some of Trump's aides
48:37who worried their boss might not stick to his guns.
48:42I felt that it was important to impress on Trump
48:46that if we were going to take strong measures against Huawei,
48:49this was not something to give away later.
48:52This had to be the beginning of a strong and consistent policy
48:56because to Trump, everything is negotiable.
49:00Everything is a bargaining chip.
49:04While Trump was in the UK,
49:07in Hong Kong, thousands joined a vigil
49:10to mark 30 years since China's deadly crackdown
49:13on pro-democracy protesters in Beijing's Tiananmen Square.
49:18The vigil took place in the midst of a growing wave of protests
49:22against a new law
49:23that would make extradition to mainland China easier.
49:28Normally, every fifth anniversary of Tiananmen,
49:31the White House would put out a statement
49:33on behalf of the president.
49:34And I had given Trump a draft statement
49:38that would commemorate the 30th anniversary.
49:41And Trump said, I'm not going to put it out.
49:43And I said, but we always put it out every five years.
49:47And if you don't put it out,
49:48it will look like we're not concerned
49:50about what happened to Tiananmen
49:52or what it represents for the future of China and Hong Kong.
49:55And he said, I don't care.
49:58Trump sees international relations
50:00through the prism of his personal relations.
50:02He thought Xi would take offense
50:05if we put out a statement by the president
50:07on Tiananmen, and he wasn't going to do it.
50:12Within weeks, as the protests in Hong Kong grew,
50:16the authorities responded with brutal force.
50:25It was against this backdrop
50:27that Trump would next meet Xi
50:29at that year's G20 summit.
50:37The U.S. president was facing further calls
50:40to confront him about Hong Kong
50:41and China's wider human rights record,
50:44including the treatment of Uyghur Muslims in Xinjiang.
50:48As he landed, he took a call
50:50from the Speaker of the House.
50:54He said, well, since you're at the G20,
50:56you're in Asia.
50:57Isn't it remarkable what's happening in Hong Kong?
51:01Millions of people are in the streets
51:03demonstrating for democracy.
51:07I'm sure G20 won't say anything about that
51:10because she is there.
51:13But I think it would be great
51:14if you could say something to him
51:16that the House and the Senate,
51:19Democrats and Republicans,
51:22have voted in favor of the Uyghurs.
51:28There's always a summit dinner
51:29at these G20 summits,
51:31and typically it's just the leader
51:33of each country and their spouse
51:35if they're there.
51:37One of my staff talked to the U.S. interpreter
51:41who was with Trump,
51:42who reported that he had a conversation
51:44with Xi Jinping
51:46and talked about the Uyghurs,
51:48and Xi defended against charges
51:51that these are essentially concentration camps.
51:53And he said the Uyghurs appreciated it.
51:56They liked it.
51:57It was a good thing to do.
51:58And Trump basically said,
52:00well, then go ahead and do it.
52:03Next day, he calls me back and he said,
52:06I mentioned Muslims to President Xi,
52:10and he said they like being in those labor camps.
52:19China's record on human rights
52:21was never going to be top of Trump's agenda.
52:24Trade negotiations had ground to a halt
52:27and election year was fast approaching.
52:30A trade deal with China
52:32could be a vote winner
52:33in the manufacturing
52:34and agricultural heartlands of America.
52:38You know, we've had a excellent relationship,
52:41but we want to do something
52:44that will even it up with respect to trade.
52:47I think it's something that's actually
52:49very easy to do.
52:51Trump basically said to Xi,
52:53look, I want to win this election
52:54and I need the farmers' vote
52:56and you can help me out on that.
52:59And indeed, the trade negotiation
53:01then turned into
53:02how many tons of soybeans
53:04are they going to buy next year?
53:07At that point,
53:09the trade is mostly focused on
53:11Chinese buying things,
53:13okay,
53:14on a massive scale.
53:30Xi Jinping had great skill in flattering Trump,
53:33and Trump responded
53:35as he often did
53:37with flattery of his own.
53:40So he took to calling Xi king.
53:45And in Osaka,
53:46it got even worse.
53:48He told him at one point,
53:49you're the greatest leader
53:51in contemporary Chinese history.
53:53And 30 seconds later,
53:54he said,
53:54you're the greatest leader
53:55in all of Chinese history.
53:57So we waited to see
53:58how Xi would respond to Trump.
54:02But he didn't call him
54:04the greatest leader
54:04in all American history.
54:06He just pocketed it
54:07and the conversation went on.
54:19At home,
54:21Xi appeared more powerful than ever.
54:23Later that year,
54:25he took center stage
54:26as the Chinese Communist Party
54:28celebrated 70 years of rule in China.
54:32A statement of power
54:34in the face of the Hong Kong protests.
54:37Today,
54:39the socialist socialist country
54:41is still in the Middle East.
54:46There is no power
54:47to prevent the Chinese people
54:50and the Chinese people
54:53of the Middle East.
54:59Unlike Trump,
55:01Xi didn't have to worry
55:02about elections.
55:05In fact,
55:07China had abolished term limits,
55:09meaning he could now remain
55:10president for life.
55:14And when it came
55:15to negotiating with Trump,
55:17the Chinese were increasingly confident
55:19that by playing the long game,
55:21they would ultimately win out.
55:24China understood
55:26Trump's way of operating
55:28as a professional wrestler.
55:32Start opening
55:33saw bow,
55:34it's always
55:34outrageous,
55:37frightening.
55:38If you chicken out,
55:40then he will push
55:41even more.
55:42If you stand for,
55:43if you know
55:44you have capacity
55:45to stand up,
55:46he will come down.
55:49While Xi was parading
55:50his military might,
55:52his negotiators
55:53were putting
55:54the final touches
55:55to a trade deal
55:56with Trump.
55:57It was optimistically named
55:59the Phase One Agreement.
56:01Trump would sign it
56:03with China's vice-premier
56:04to much fanfare.
56:06The U.S. agreed
56:08to ease tariffs
56:09on China.
56:11In return,
56:12China pledged
56:13to buy hundreds
56:14of billions
56:14of dollars
56:15of U.S. goods.
56:17But Trump
56:18didn't get
56:18the major concessions
56:20on China's trade practices
56:21he talked about
56:22on coming to office.
56:24It's a relief
56:25from the Chinese side
56:26because we had
56:27a very,
56:28we have a tension,
56:29you know.
56:31And January 2020,
56:33it's less than
56:33one year ahead
56:34of the general election.
56:36We believe
56:36we would have
56:37a relatively stable
56:38bilateral relations
56:40in that year
56:40and if President Trump
56:42won the election
56:43paved the way
56:44for the second term.
56:48It's important
56:49to remind yourself
56:50that it's not possible
56:52to have an agreement
56:55between the United States
56:56and China
56:57that's going to resolve
56:58the problem
56:59of a Marxist-Leninist country
57:01that wants to be
57:02the number one country
57:03in the world.
57:03It's like,
57:04you can't imagine
57:05an agreement
57:06between the United States
57:08or the West
57:09and Soviet Union
57:10that would have resolved
57:11the fact that
57:12they want to take over
57:13the world
57:13and we don't want them to,
57:15right?
57:15Today we take
57:17a momentous step,
57:19one that has never
57:20been taken before
57:21with China.
57:21But what these agreements
57:23can do
57:23is stop movement
57:24towards a hot war
57:25which would be
57:26a catastrophe.
57:27Nobody's ever seen
57:29anything like it.
57:29This is the biggest deal
57:30there is anywhere
57:32in the world
57:32by far.
57:34Trump had his deal
57:37but as he talked it up
57:38the world was about
57:39to be hit
57:40by a catastrophe
57:41that few saw coming.
57:43One that would bring
57:44the US and China
57:45closer than ever
57:46to a new Cold War.
57:50China plague.
57:52That's where it comes from.
57:53They say,
57:54please don't mention China.
57:55I say, why?
57:55That's where it comes from.
57:58I remember President Trump
57:59telling me that
58:00if he did 100 trade deals
58:02with China,
58:04it still wouldn't make up
58:06for the losses
58:07that COVID had inflicted
58:09on the United States.
58:10In the next episode,
58:13as a global pandemic
58:15rocks the US-China relationship,
58:17the race for technological
58:18supremacy ramps up.
58:22And the stakes are raised
58:24as one of America's
58:25leading figures
58:26crosses a Chinese red line.
58:29You have to understand
58:30whether it's going
58:31to Tiananmen Square
58:31or going to Taiwan.
58:33You cannot let
58:35somebody else decide
58:37where you're going.
58:39This is the closest moment
58:41of a military encounter.
58:45My understanding
58:46is that 20% of the Chinese
58:47did not sleep at that night.
58:50She's going to tell us
58:51where we can go?
58:52I don't think so.
58:57And you can watch
58:58the next episode
58:59right now
59:00on BBC iPlayer.
59:02Also there,
59:03AI Confidential
59:04with Hannah Fry.
59:05Extraordinary human stories
59:07from the high-tech frontier.
59:09Watch now.
59:10Inside a publishing scandal
59:12with a new podcast
59:13on sounds,
59:15Secrets of the Salt Path.
59:16Listen now.
59:17.
59:17.
59:17.
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