CHINA UPS STAKES IN TARIFF ROW WITH THE US

▶ Beijing threatens to void all trade agreements if Washington presses ahead with protectionist policy

China warned the United States yesterday that any agreements reached on trade and business between the two countries will be void if Washington implements tariffs and other trade measures, as the two ended their latest round of talks in Beijing.

A short statement, carried by the official Xinhua news agency, made no mention of any specific new agreements after US Commerce Secretary Wilbur Ross met Chinese Vice Premier Liu He.

It referred instead to a consensus they reached last month in Washington, when China agreed to significantly increase its purchases of US goods and services.

“To implement the consensus reached in Washington, the two sides have had good communication in various areas such as agriculture and energy, and have made positive and concrete progress,” the state news agency said. Details would be subject to “final confirmation by both parties”, it said.

The US and China have threatened tit-for-tat tariffs on goods worth up to $150 billion each.

Xinhua said China’s attitude had been consistent and that it was willing to increase imports from all countries, including the US.

“Reform and opening up and expanding domestic demand are China’s national strategies. Our established rhythm will not change,” it said.

“The achievements reached by China and the United States should be based on the premise that the two sides should meet each other halfway and not fight a trade war,” Xinhua said. “If the United States introduces trade sanctions including raising tariffs, all the economic and trade achievements negotiated by the two parties will be void.”

There was no immediate comment or statement from the US delegation or from Mr Ross himself.

At the end of last month’s Washington talks, the two countries put out a joint statement.

But just when it appeared a trade truce between the economic heavyweights was on the cards, the White House last week warned it would pursue tariffs on $50bn worth of Chinese imports, as well as impose restrictions on Chinese investments in the US and tighten export controls.

State-run Chinese newspaper the Global Times said in an editorial on its website that China needed to prepare for the long haul due to the US propensity for changing its mind and coming up with new demands.

“Tariffs and expanding exports – the United States can’t have both,” it said. “China-US trade negotiations have to dig up the two sides’ greatest number of common interests, and cannot be tilted toward unilateral US interests.” Xinhua said in a separate commentary that the US should not test China with any further flip-flops or provocations. “The Chinese government’s attitude of not wanting but also not fearing a trade war has never changed,” it said.

Mr Ross arrived in Beijing on Saturday for talks after the Trump government renewed

The achievements reached by China and the United States should be based on the two sides meeting halfway XINHUA State news agency

tariff threats against China, and with key US allies in a foul mood towards Washington after they were hit with duties on steel and aluminium.

Addressing Mr Liu earlier in the day at the start of their formal talks at a government guest house, Mr Ross praised the tone of their interactions.

“Our meetings so far have been friendly and frank, and covered some useful topics about specific export items,” Mr Ross said, in brief comments before reporters.

Mr Liu spoke only to welcome Mr Ross.

Neither man has made any other comments to the media. Mr Ross left Beijing yesterday. Mr Liu, a Harvard-trained economist who is a trusted confidant of Chinese President Xi Jinping, is China’s chief negotiator in the trade dispute.

US Treasury Secretary Steven Mnuchin said on Saturday the US wanted the weekend’s talks to result in structural changes to China’s economy, in addition to increased Chinese purchases of American goods.

The purchases are partly aimed at shrinking the $375bn US trade deficit with China.

Mr Mnuchin, speaking at a G7 finance leaders meeting in Canada where he was the target of US allies’ anger over steel and aluminium tariffs, said the China talks would cover other issues, including the Trump government’s desire to eliminate Chinese joint venture requirements and other policies that effectively force technology transfers.

“I want to be clear, this isn’t just about buying more goods, this is about structural changes,” Mr Mnuchin said.