Xi vows to further open China economy as US trade spat simmers

BEIJING: Chinese President Xi Jinping pledged yesterday to lower car tariffs this year and take other steps to open the world’s number two economy ‘wider and wider’, addressing major complaints by the United States in a simmering trade row.

Xi’s remarks follow weeks of titfor-tat tariffs between Beijing and Washington and mutual threats of more levies on hundreds of billions of dollars worth of products that have raised fears of a trade war that could lacerate the global economy.

While he did not directly mention US President Donald Trump’s demands, Xi told an economic forum on the southern island of Hainan that Beijing “does not seek a trade surplus” and hopes to increase imports.

Promising a “new phase of opening up”, he said China will “considerably lower” tariffs on cars and other products this year, take measures to liberalise automobile investment, and protect intellectual property – all areas that have been high on the list of demands by Washington.

“Economic globalisation is an irreversible trend of the time,” Xi told the Boao Forum for Asia.

“The door of China’s opening up will not close, it will only open wider and wider.”

But he gave no details or an exact date for taking the measures.

The car tariffs were the target of a Trump tweet on Monday.

Asia markets – hammered along with global equities by the trade row in recent weeks – rallied on the speech Tuesday.

“Asian markets are happy, US and European markets are likely to be happy too, but it’s unlikely to generate the same optimism in Washington,” said Christopher Balding, a Peking University economics professor.

“The tone was conciliatory but Washington is bargaining for action, not promises.”

Christine Lagarde, managing director of the International Monetary Fund, congratulated the Chinese leader on his commitment to openness in a speech to the forum.

The measures he laid out such as “removing caps, reducing barriers” were “very specific,” she told the Boao Forum, an Asian version of the World Economic Forum, which drew global leaders to Hainan this week. — AFP