Rivalry and mistrust between the U.S. and China have shaken the confidence of the business world and pushed the relationship between the two countries to its lowest point in decades.

But walking away from the deep economic ties that have been forged in the past decades is simply not an option, the U.S. ambassador to China, Nicholas Burns, told “60 Minutes.” 

The relationship with China is the most important, most competitive and most dangerous the U.S. has in the world, Burns said – and he believes that’s not changing anytime soon.

“Some people are saying, ‘Well, we’re so competitive with China, we should end the economic relationship,'” Burns said. “Well, the consequence of that would be 750,000 American families wouldn’t be able to put dinner on the table.”

That’s because ties between the two economic giants directly support American workers growing, producing and exporting goods and services to China.

U.S.-China competition 

Navigating America’s competing interests in China is a difficult balancing act for Burns. 

“We have competing interests here, and balancing those interests is the reality in the U.S.-China relationship,” he said during an interview in Beijing. “We’re going to compete. We have to compete responsibly and keep the peace between our countries. But we also have to engage.”

China and the U.S. are aggressively competing on artificial intelligence, biotechnology and quantum mathematics. Advances in those fields, Burns said, will lead to a new generation of military technology. 

“Our two militaries are vying for military supremacy, ‘Who’s going to be the most powerful in the most important, strategic part of the world, which is the Indo-Pacific,'” Burns said.

President Xi Jinping likes to say that the East is rising and the West is declining, but economically, the U.S. is thriving compared to China. China’s economy is facing high youth unemployment, slow growth and a potential debt crunch. In December, credit rating agency Moody’s cut its outlook for China to negative. 

China is also facing a long-term demographic bind. A decline in the birth rate, which some experts say is irreversible, means the country’s population is both aging and shrinking. 

And in January, Chinese real estate giant Evergrande was ordered to liquidate its remaining assets. Developers across China have run out of money to complete construction, leaving millions of Chinese citizens who had paid for apartments before they were built in the lurch.

Despite its slowing economy, China has the U.S. beat in many markets. China, with heavy government subsidies, is expected to overtake Japan as the world’s biggest exporter of cars.  Last quarter, the carmaker BYD surpassed Tesla as the best-selling EV maker in the world. The country also dominates in the wind turbine market. 

“They’re the leading trade partner of twice as many countries in the world as the United States, so they have global reach,” Burns said. 

In his annual New Year’s speech, President Xi talked about the country’s economic woes and, for the first time, acknowledged the high unemployment rate. Still, he has laid out a long-term goal of doubling China’s economy by 2035 and surpassing the West in technology.

Risks and rewards in China

Many U.S. companies operating in China are already thriving. Disney recently expanded its Shanghai Disneyland and Aptar, a $9 billion company headquartered in Illinois, invested $60 million in a new factory in China. Aptar Asia President Xiangwei Gong said that even in a slowing economy, the company is doing well. She pointed to business opportunities in health care, cosmetics and packaged foods.

“We are here for the long-term and we believe in the consumption power of the rising middle class,” Gong said. “It’s 1.4 billion people here.”

Walmart has more than 300 locations across China. Shoppers can buy Levi’s, browse in Apple stores and get frappuccinos at one of around 6,000 Starbucks locations in China. Boeing, Tesla, Pfizer, Chevron and Intel all do work out of China. U.S. financial firms have strong operations in the country as well. The Chinese government says there are tens of thousands of U.S. companies in China. 

Still, other companies and business leaders are wary, despite the lure of a country that’s home to so many potential consumers. For the first time in more than 40 years, more money is leaving China than is coming in from American, Japanese, European and Korean investors, Burns said. 

The ambassador pointed out that in the decades before President Xi, China powered its economy by investing in high-speed trains, roads, factories and skyscrapers. Yet in the last year, China lost more than $120 billion in long-term foreign investments, according to Beijing data.

Harsh government tactics have left American companies uncertain of the future.

“I think there’s been a contradiction in the messaging from the government here in China to the rest of the world. On the one hand, they say, ‘We’re open for business. We want American, Japanese businesses here,'” Burns said. “But on the other hand, they’ve raided six or seven American businesses since last March.”

The Mintz Group, a company that does due diligence for other companies that might want to invest in China, was raided last year. Five of its Chinese employees were taken into custody. Another firm, Capvision, was also raided. A report on state-run television accused Western consulting firms of espionage and stealing national security and military secrets.

“I think they want to control data about the Chinese people, about Chinese companies. That, I think, is at the heart of the problem with those American companies operating in that sphere,” Burns said. 

“Our two countries have to live together”

Presidents Biden and Xi met in San Francisco in November in the hopes of easing tensions, especially around the South China Sea, where Beijing has been building up military bases, increasing air sorties near Taiwan and buzzing around U.S. military planes. 

“I think we’re back to a more settled and stable relationship between the two countries, but it’s been a rollercoaster,” Burns said.

The two countries are deeply connected economically. 

China was the third largest purchaser of U.S. exports in 2022, according to the Office of the U.S. Trade Representative. It was also the top supplier of goods to the U.S. that year, accounting for 16.5% of total goods imports. China is also the largest export market for U.S agricultural products, accounting for $40.9 billion in 2022.

“Our two countries have to live together. And this, I think, is the greatest tension in the U.S.-China relationship. China’s our most significant competitor,” Burns said. “And at the same time, China is our third largest trade partner — 750,000 American jobs at stake.”

No one from the Chinese government would give “60 Minutes” an interview.

Burns views China as an “adversary” stronger than the Soviet Union was from the 1940s through the 1980s. He also doesn’t foresee an easing of tensions around the South China Sea. 

“I think ultimately, they want to become and overtake the United States as the dominant country globally,” Burns said. “And we don’t want that to happen. We don’t want to live in a world where the Chinese are the dominant country.”