By politi­ciz­ing trade ties US would harm it­self

China Daily (Hong Kong) - - COMMENT -

Re­ports that US Pres­i­dent Don­ald Trump is con­sid­er­ing im­pos­ing re­stric­tions on Chi­nese im­ports, with an an­nounce­ment forth­com­ing as early as this week, are wor­ry­ing, be­cause the move, if taken, could spark a trade war between the world’s two largest economies. The United States’ griev­ances stem from its huge trade deficit with China, which now stands at $368 bil­lion, and what it re­gards as China’s weak pro­tec­tion of in­tel­lec­tual prop­erty rights. Sec­tion 301 of the US’ Trade Act of 1974 al­lows Trump to im­pose tar­iffs or other trade re­stric­tions to pro­tect US in­dus­tries from “un­fair prac­tices” with­out fol­low­ing the dis­pute set­tle­ment mech­a­nism of the World Trade Or­ga­ni­za­tion.

That Wash­ing­ton is backpedal­ing on the joint ef­forts the two coun­tries have made to nar­row their dif­fer­ences on trade will be a blow to the mu­tual trust that both sides have worked hard to build. It could also com­pro­mise the one-year action plan on eco­nomic co­op­er­a­tion they agreed at the Com­pre­hen­sive Eco­nomic Di­a­logue in Wash­ing­ton on July 19. The plan for a year of dis­cus­sions is aimed at build­ing on the pos­i­tive mo­men­tum achieved in the 100-Day Action Plan trade ne­go­ti­a­tions between the two sides ini­ti­ated af­ter the sum­mit meet­ing in April between Trump and Pres­i­dent Xi Jin­ping.

The tim­ing of the pro­posed move has sparked spec­u­la­tion that Trump is try­ing to pun­ish China for what he sees as Bei­jing’s fail­ure to help him rein in the Demo­cratic Peo­ple’s Repub­lic of Korea’s nu­clear weapons pro­gram. But that as­sump­tion is un­founded, and politi­ciz­ing the trade issue in this way risks harm­ing Sino-US re­la­tions.

Bei­jing al­ways in­sists that trade dis­putes and fric­tions, which are in­evitable given the size of the two economies, should be re­solved through di­a­logue and con­sul­ta­tions. And this is im­per­a­tive given how com­ple­men­tary and in­ter­de­pen­dent the two economies are.

If it re­sorts to a do­mes­tic law to ad­dress its trade dis­putes with China, rather than re­ly­ing on di­a­logue or the dis­pute-set­tle­ment mech­a­nism of the WTO, the US would be­lie its claim that it wants to build “fair, eq­ui­table and re­cip­ro­cal” trade re­la­tions with China.

And im­pos­ing tar­iffs and re­stric­tions on Chi­nese im­ports would serve the in­ter­ests of nei­ther side, since China will have no choice but to take re­tal­ia­tory mea­sures, thus paving the way for a trade war. Both sides should work hard to avoid that dam­ag­ing even­tu­al­ity.

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