The image of Chris Miller. (PHOTO: SCREENSHOT)

Western leaders have adopted a buzzword to describe their strategy: "de-risking." This involves continuing to roll out tech and investment restrictions on China, but coupling them with high-level summitry and calls to keep trade flowing. The aim is to limit the risk of escalation in both the political and economic spheres. It is unlikely to work.

The West shifted away from the tougher "decoupling" rhetoric and towards de-risking and "economic security" for two reasons. First, hawks in Japan and America needed softer language to keep on board wobbly European allies, who call China a "systemic rival" but prefer that other countries pay the price of restraining it. De-risking sounds safe and low-cost. Second, President Joe Biden's administration hopes that the pressure imposed by America's years-long effort to contain China has made Beijing more pliable. But, the low-cost de-risking will fail.

China's government believes it can overcome the West's tech restrictions. Beijing is pursuing its own agenda of reducing its reliance on Western manufacturing technology, while continuing its effort to make the West more dependent on Chinese products, from low-end chips to electric vehicles.

Start with China's confidence that it can overcome the restrictions. The second problem with de-risking is that Western firms are not listening to politicians' rhetoric—instead they are taking costly steps to restructure their relationship with China. The third reason a narrow de-risking won't work is that it ignores China's own strategy: decoupling with Chinese characteristics.

Chris Miller, The West's de-risking strategy towards China will fail,? https://www.economist.com, 04-08-23