Shortly before the United States and China announced that they had reached a “Phase One” trade deal, Paul Haenle sat down with Andy Rothman, principal advisor at the investment firm Matthews Asia and former head of macroeconomics and domestic policy at the U.S. embassy in Beijing. The two discussed the trade dispute, whether the U.S. policy of economic engagement with China failed, and the trade deal.

Rothman argued that, contrary to the dominant narrative in Washington, engagement has accomplished many of the goals it was designed to achieve. China has dramatically liberalized its economy, is one of the largest markets for U.S. companies, and is a source of cheap goods for American consumers. He argued decoupling is both impractical, given how integrated the two economies have become and how much U.S. companies rely on the Chinese market, and politically unfeasible, insofar as U.S. allies would be reluctant to back the effort. A more viable strategy would be to focus on achieving limited goals, such as securing increased market access and IP protection, rather than a structural overhaul of the Chinese economy. However, Rothman said that the first step should be securing a “Phase One” deal.