U.S. President Joe Biden meets with Chinese President Xi Jinping.

A common understanding of why U.S.-China relations have cratered since the 2016 election of former President Donald Trump is that the world’s two largest economies had gone from being complementary to being increasingly competitive and zero-sum. But even in this economic relationship, there are still ways to find common ground.

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Recent setbacks for two major Chinese projects in Latin America are likely music to U.S. policymakers’ ears and could point to the quiet diplomacy of the administration of U.S. President Joe Biden paying off in key areas of concern. How Beijing reacts to these setbacks will shape its future relations with Latin America.

Yangshan deep water port in Shanghai.

The consequences of Chinese President Xi Jinping’s intention to double down on China’s manufacturing prowess to boost growth has attracted a lot of discourse. But it’s important to understand that excess capacity has a political logic within the Chinese system that is fundamental to the country’s governance model.