John Lee Cheong Seong

Trade deal aside, Sino-US rivalry is far from over: China’s Communist Party-driven economy is incompatible with the global order

The World Trade Organisation has never before dealt with an economy like China’s, where the party picks winners and compels firms to toe the line

Increasingly, when called on to punish foreign entities, Chinese firms have little choice but to show their loyalty, the NBA row just the latest example

Reading Time:3 minutes

Why you can trust SCMP

China’s “national champions” like Huawei receive state support in their efforts to dominate key sectors, both domestically and abroad. In Huawei’s case, this has made them a target. Photo: Reuters

John Lee Cheong Seong

Published: 1:00am, 18 Oct 2019Updated: 3:42am, 18 Oct 2019

US Commerce Secretary Wilbur Ross recently told an American Chamber of Commerce audience in Australia that President Donald Trump was keeping the pressure on China to repair the rules-based order and global economic system, and allies like Australia should join. A day later, the US and China announced they had reached a partial trade deal which will halt the next round of threatened tariffs.

Are we heading towards reconciliation or further tension between the world’s two largest economies? For a clue, look to the escalating stand-off between America’s National Basketball Association and China.

As the NBA dispute indicates, the partial trade deal will do little to repair a fundamental fissure between the US and China: the Communist Party is able to persuade Chinese commercial entities to follow the party’s directives.

Consider what punishing the Houston Rockets and the NBA ought to remind us about the Chinese system. After the Houston Rockets’ general manager Daryl Morey posted an image on Twitter that included support for Hong Kong’s pro-democracy protesters, the Chinese Basketball Association suspended all cooperation with the Texas-based team, even though the tweet was deleted soon after.

CCTV, the major broadcaster of the sport in China, announced it would suspend airing Rockets events. Chinese internet giant Tencent Sports threatened to suspend live streaming for Rockets games while sponsors such as Li Ning Company and Shanghai Pudong Development Bank threatened to withdraw their support.

Houston Rockets general manager Daryl Morey probably had little idea that a tweet in support of Hong Kong’s protesters would set off an international incident. Photo: USA Today Sports