China-U.S. Tensions Are Over Far More Than Trade

(Bloomberg) -- As the trade war between the U.S. and China deepens, political spats between the world's two largest economies are surfacing or intensifying. And the rhetoric is getting chillier. Issues range from the plight of China's Uighurs and sanctions against the Chinese military to President Donald Trump's accusation that China is interfering in upcoming U.S. midterm elections. Here's a summary of the flashpoints.

Sanctions on China's military

Trump's administration in September penalized a Chinese military procurement agency and its director for violating U.S. sanctions by purchasing Russian combat aircraft. Among Russia's arms customers, the U.S. has so far targeted only China. “We strongly urge the U.S. side to correct its mistake immediately and withdraw so-called sanctions,” Chinese Vice Foreign Minister Zheng Zeguang told the U.S. ambassador to China, according to a Foreign Ministry statement. “Otherwise the U.S. side will have to bear all the consequences.”

Warship Port Call Denied

After the sanctions on the procurement agency were levied, China refused a U.S. warship an October entry to Hong Kong, according to the U.S. Consulate General in Hong Kong. The vessel, the USS Wasp, is a U.S. Navy amphibious assault ship. The same day, China recalled its top naval officer, who canceled a high-level meeting with his American counterpart. China's military actions are a way of “showing displeasure without crossing the line into something more serious,” said Collin Koh Swee Lean, a research fellow at the S. Rajaratnam School of International Studies in Singapore.

Election Meddling

“China has been attempting to interfere in our upcoming 2018 election, coming up in November, against my administration,” Trump said at a United Nations Security Council meeting Sept. 26, without providing evidence or details. Three days earlier, China had placed a four-page advertising supplement in Iowa's largest newspaper criticizing Trump's tariffs on Chinese imports. “I don't like it when they attack our farmers. And I don't like it when they put out false messages,'' Trump told reporters before the UN meeting. “But beside that, we learned that they are trying to meddle in our election.'' China's response? “We do not and will not interfere in any country's domestic affairs,” Foreign Minister Wang Yi said at the Security Council meeting, through a translator. “We refuse to accept any unwarranted accusations against China.”

Taiwan

China's Defense Ministry issued a sharply worded statement Sept. 24 after the U.S. approved the sale to Taiwan of $330 million of military equipment. Taiwan -- which China considers one of its provinces -- has been a point of tension since Trump broke with years of protocol for U.S. leaders and spoke with Taiwanese President Tsai Ing-wen by phone shortly after his election win in 2016. Trump then infuriated China by saying he'd use the One-China policy as a bargaining chip to get a better trade deal. The policy -- -- the idea that China and Taiwan are part of the same country -- has been the basis of U.S.-China ties concerning the island since the 1970s.

South China Sea

The U.S. regularly directs warships and fighter jets within close range of territory claimed by China, including military facilities built on artificial islands, drawing protests from Beijing and creating the potential for military miscalculation. Britain, France and Japan have also sent navy ships into the waters this year. About half of the world's merchant fleet navigates through the fish-rich waters, which contain potentially vast oil and gas reserves. China has rejected an international tribunal's ruling that its claims to more than 80 percent of the South China Sea have no legal basis.

East China Sea

The East China Sea has even more potential for danger. The U.S. has repeatedly assured Japan that islands there claimed by both Japan and China are covered by a 1960 security treaty obliging the Americans to “act to meet the common danger” if Japanese-administered territories are attacked. Ships and planes from the two Asian neighbors often tail one another around the islands, known as the Senkaku in Japan and Diaoyu in China. Japan's Defense Minister Itsunori Onodera said in September that China had been “unilaterally escalating” its military activities in the past year, including carrying out new airborne operations and running a nuclear submarine near the disputed isles.

Tibet

The U.S. State Department in April blasted China for “severe” repression in its Himalayan province, including arbitrary detention and censorship. In September, Congress passed a bipartisan bill that seeks to impose a visa ban on Chinese officials who deny U.S. citizens, government officials or journalists access to Tibet. Tensions may worsen over the succession of Tibet's spiritual leader, the Dalai Lama, who fled to India in 1959 as a revolt against Chinese rule was quashed. Beijing has begun laying out the case for why it should appoint the 83-year-old's successor rather than his exiled supporters in India.

North Korea

This point of tension waxes and wanes. On Sept. 26, Trump said that working with Chinese President Xi Jinping on the issue “has been a pleasure and an honor.” But in August, Trump was blaming China for a lack of progress on talks about North Korea shedding its nuclear weapons, tweeting “I do not believe they are helping with the process of denuclearization as they once were.” U.S. Secretary of State Michael Pompeo will travel to Pyongyang in October to prepare for a second summit between Trump and North Korea's leader Kim Jong Un.

The Uighurs

As reports emerge that China is forcing tens of thousands -- perhaps as many as 1 million -- Uighurs (ethnic Muslims) into “re-education” camps in its far western region of Xinjiang, U.S. senators led by Marco Rubio are pushing for sanctions against seven Chinese officials and two surveillance equipment manufacturers. They want to unleash the Global Magnitsky Act of 2016, which has been employed to punish Russian oligarchs and Turkish officials, to restrict the travel and freeze the assets of local Communist Party bigwigs.

The Reference Shelf

• Could a trade war lead to a real war? Former Australia Prime Minister Kevin Rudd poses the question in a Bloomberg Opinion article.
• QuickTakes on the South China Sea, the Uighurs, Taiwan tensions and North Korea nuclear talks.
• Military tensions are on the rise.
• Trump and Xi headed for messy divorce, writes Bloomberg Opinion's Andrew Browne.

To contact the reporter on this story: David Tweed in Hong Kong at dtweed@bloomberg.net

To contact the editors responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net, Grant Clark, Karen Leigh

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