The U.S. and China can cooperate only when there is a restoration of democracy in Hong Kong and human rights for the Uyghurs, said Nobel prize-winning economist Joseph Stiglitz.

The former chief economist of the World Bank gave his remarks on the global situation in a breakfast event held by the Foreign Correspondents' Club on Tuesday, adding that trade talks and intellectual property rights tussles are just “little pimples” compared to other more major issues.

He believed that there is still room for cooperation between the U.S. and China amid rising tensions, but not without conditions.

“I hope we can cooperate, but we can only cooperate if there is a restoration of democracy in Hong Kong, if there is respect for human rights of the Uyghurs, if there is a movement away from a surveillance state.” There is a lot of room for cooperation, but it looks like these important issues are not likely to be solved, Stiglitz worried.

The top economist also offered a bleak outlook for Hong Kong, especially in terms of its international standing, after China imposed a draconian national security law on the city. The many grey areas and ambiguities in the law, and especially the fact that “when people disappeared”, have caused increasing anxiety, he noted

That said, he stressed that Hong Kong has not been forgotten. “What happened in Hong Kong is going to have profound effects on the relationship between China and the West.”

Stiglitz also shed light on the “decoupling” between the U.S. and China, saying it is still at an early stage of discussions and the upcoming presidential election in November will determine what will happen between the world’s two largest economies

“But there are very strong trends in the U.S. that are very concerned about human rights, about what’s happening in Hong Kong [and to] the Uyghurs. And they believe that the West, the democracies like Europe and the U.S. need to express their views about what is happening, not just turn the other way,” Stiglitz said, adding that those perspectives are leading the beginning of a decoupling process.

The 2001 Nobel laureate in economics said the current global stand-off is no longer a battle over ideologies like communism versus capitalism, but a “simple battle between democracy and authoritarianism”.

He also noticed that China appears to have a strong economic comeback from the COVID-19 pandemic while Europe and the U.S. are still far from recovery. But the current growth in China is much lower than that of the U.S. after the 2008 financial crisis, hence not enough to fuel global recovery, he said.

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