US of­fer for trade talks wel­comed

Coun­ter­mea­sures still planned if Wash­ing­ton im­poses new tar­iffs

China Daily (Hong Kong) - - FRONT PAGE - By ZHONG NAN and JING SHUIYU in Beijing and ZHAO HUANXIN in Wash­ing­ton Con­tact the writ­ers at zhong­nan@chi­nadaily.com.cn

The Min­istry of Com­merce con­firmed on Thurs­day that China has re­ceived an in­vi­ta­tion from the United States to re­open trade talks, say­ing it wel­comes the move.

An­a­lysts warned that the US risks un­der­es­ti­mat­ing China’s ca­pa­bil­ity to hit back if it con­tin­ues to im­pose tar­iffs on more Chi­nese goods.

Gao Feng, a min­istry spokesman, said China and the US cur­rently are com­mu­ni­cat­ing on many spe­cific de­tails, and the es­ca­la­tion of trade fric­tion is in­con­sis­tent with the in­ter­ests of ei­ther party.

His com­ments came af­ter top White House eco­nomic ad­viser Larry Kud­low said on Wed­nes­day the US gov­ern­ment has in­vited Chi­nese of­fi­cials to restart trade talks.

The out­reach comes as the world’s two largest economies are em­broiled in trade dis­putes, with US Pres­i­dent Don­ald Trump poised to de­cide whether to raise du­ties on $200 bil­lion of Chi­nese goods — or on even more.

To safe­guard the in­ter­ests of its ex­porters, man­u­fac­tur­ers and other busi­nesses, China has al­ready vowed to “def­i­nitely take coun­ter­mea­sures” if the US raises tar­iffs fur­ther.

Gary Huf­bauer, a se­nior fel­low and trade ex­pert at the Peter­son In­sti­tute for In­ter­na­tional Eco­nom­ics in Wash­ing­ton, said Trump is con­cerned about the ad­verse fi­nan­cial mar­ket con­se­quences as a re­sult of trade ten­sions and the en­su­ing po­lit­i­cal ef­fects if he im­poses higher tar­iffs ahead of the Novem­ber midterm elec­tions.

“Trump wants to show the Congress and com­pa­nies that ob­ject to the pro­posed tar­iffs that he is a rea­son­able man, will­ing to ne­go­ti­ate (with China) be­fore tak­ing ac­tion.”

US busi­nesses in China also fear that the threat of ad­di­tional tar­iffs on $200 bil­lion in Chi­nese goods would gen­er­ate strong neg­a­tive im­pacts on their oper­a­tions in China.

The re­sults of a joint sur­vey by the Amer­i­can Cham­ber of Com­merce in China and Amer­i­can Cham­ber of Com­merce in Shang­hai were re­leased on Thurs­day. It mea­sured the im­pact of the tar­iffs im­posed by China and the US on each other since July.

Close to two-thirds of re­spon­dents said the tar­iffs are hav­ing a neg­a­tive im­pact.

The sur­vey said 63.6 per­cent re­ported the ini­tial US tar­iffs on $50 bil­lion in Chi­nese goods are af­fect­ing their busi­ness oper­a­tions. When asked about the im­ple­men­ta­tion of the pos­si­ble ad­di­tional US and Chi­nese tar­iffs, the pro­por­tion of mem­bers who cited a neg­a­tive im­pact jumped to 74.3 per­cent and 67.6 per­cent, re­spec­tively.

The per­cent­age re­port­ing a “strong neg­a­tive im­pact” in that case dou­bled from 21.5 per­cent to 47.2 per­cent for the US tar­iffs. Over 430 com­pa­nies re­sponded to the sur­vey.

“The White House has threat­ened to fire the next bar­rage of tar­iffs at $200 bil­lion more in Chi­nese goods, ex­pect­ing with this on­slaught, or sub­se­quent ones, China will wave a white flag. But that sce­nario risks un­der­es­ti­mat­ing China’s ca­pa­bil­ity to con­tinue meet­ing fire with fire,” said Wil­liam Zarit, chair­man of AmCham China.

“The US ad­min­is­tra­tion runs the risk of a down­ward spi­ral of at­tack and coun­ter­at­tack, ben­e­fit­ing no one,” Zarit said.

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