China seeks to re­brand global trade image

The Myanmar Times - - International Business -

FAC­ING a bliz­zard of trade com­plaints, China is throw­ing an “open for busi­ness” im­port fair hosted by Pres­i­dent Xi Jin­ping to re­brand it­self as a wel­com­ing mar­ket and pos­i­tive global force.

More than 3,000 com­pa­nies from 130 coun­tries sell­ing ev­ery­thing from Egyp­tian dates to fac­tory ma­chin­ery are at­tend­ing the China In­ter­na­tional Im­port Expo , open­ing Mon­day in the com­mer­cial hub of Shang­hai. Its VIP guest list in­cludes prime min­is­ters and other lead­ers from Rus­sia, Pak­istan and Viet­nam.

The United States, fight­ing a tar­iff war with Bei­jing, has no plans to send a high-level en­voy.

Xi’s gov­ern­ment is em­pha­siz­ing the prom­ise of China’s grow­ing con­sumer mar­ket to help defuse com­plaints Bei­jing abuses the global trad­ing sys­tem by reneg­ing on prom­ises to open its in­dus­tries.

“This says, look, we’re not a global par­a­site that is cre­at­ing mas­sive deficits, we are buy­ing goods,” said Kerry Brown, a Chi­nese pol­i­tics spe­cial­ist at King’s Col­lege Lon­don.

The event also is part of ef­forts to de­velop a trad­ing net­work cen­tered on China and in­crease its in­flu­ence in a Western-dom­i­nated global sys­tem.

Pres­i­dent Don­ald Trump and his “Amer­i­can first” trade poli­cies that threaten to raise im­port bar­ri­ers to the world’s big­gest con­sumer mar­ket loom in the back­ground.

Ex­porters, es­pe­cially de­vel­op­ing coun­tries, want closer re­la­tions with China to help “in­su­late them­selves from what is hap­pen­ing with Trump and the U.S.,” said Gareth Leather of Cap­i­tal Eco­nom­ics.

China has cut tar­iffs and an­nounced other mea­sures this year to boost im­ports, which rose 15.9 per­cent in 2017 to $1.8 tril­lion. But none ad­dress the U.S. com­plaints about its tech­nol­ogy pol­icy that prompted Trump to im­pose penalty tar­iffs of up to 25 per­cent on $250 bil­lion of Chi­nese im­ports. Bei­jing has re­sponded with tar­iff hikes on $110 bil­lion of Amer­i­can im­ports.

Chi­nese lead­ers have re­jected pres­sure to roll back plans such as “Made in China 2025,” which calls for stateled cre­ation of global cham­pi­ons in robotics and other fields, am­bi­tions that some Amer­i­can of­fi­cials worry will un­der­mine U.S. in­dus­trial lead­er­ship.

To keep the econ­omy grow­ing, China needs to nur­ture its con­sumer mar­ket and that re­quires more im­ports.

But for­eign com­pa­nies say reg­u­la­tors are still try­ing to squeeze them out of promis­ing in­dus­tries and that they face pres­sure to hand over tech­nol­ogy.

The Shang­hai expo “will be of lit­tle con­se­quence to U.S. and other com­pa­nies un­less its pageantry is matched by mean­ing­ful and mea­sur­able changes in China trade prac­tices,” Ken­neth Jar­rett, pres­i­dent of the Amer­i­can Cham­ber of Com­merce in Shang­hai, said in an email.

Some com­pa­nies might get a brief sales boost, “but its long-run im­pact will be de­fined by China’s willing­ness to end many of its un­fair trade prac­tices,” said Jar­rett.

Europe, Japan and other trad­ing part­ners have been leery of Trump’s tac­tics but echo U.S. com­plaints.

They say Bei­jing im­prop­erly ham­pers ac­cess to fi­nance, lo­gis­tics and other ser­vice in­dus­tries. Euro­pean lead­ers are frus­trated that Bei­jing bars for­eign ac­qui­si­tions of most as­sets while its own com­pa­nies are on a global buy­ing spree.

Writ­ing in a Chi­nese busi­ness mag­a­zine, the French and Ger­man am­bas­sadors to Bei­jing ap­pealed for changes in­clud­ing an end to re­quire­ments that for­eign com­pa­nies op­er­ate in joint ven­tures with state-owned part­ners. They called for an over­haul of rules they say hin­der com­pa­nies from prof­it­ing from and pro­tect­ing their tech­nol­ogy.

“We en­cour­age China to ad­dress these is­sues through con­crete and sys­tem­atic mea­sures that go be­yond tar­iff ad­just­ments,” Am­bas­sadors JeanMau­rice Ripert of France and Cle­mens von Goetze of Ger­many wrote in the mag­a­zine Caixin.

China al­ready is the No. 1 trad­ing part­ner for all its Asian neigh­bors, though a big share of the iron ore, in­dus­trial com­po­nents and other goods it buys are turned into smart­phones, TV sets and other goods for ex­port.

Tar­iff cuts an­nounced over the past year were aimed at giv­ing Chi­nese con­sumers bet­ter ac­cess to for­eign goods. Chi­nese lead­ers em­pha­size those in­clude anti-can­cer drugs and other med­i­cal prod­ucts. But many are spe­cialty goods such as high-end baby strollers, av­o­ca­dos and min­eral wa­ter that don’t com­pete with Chi­nese sup­pli­ers.

The Shang­hai expo also gives Bei­jing a chance to re­pair its image fol­low­ing com­plaints about its “Belt and Road” ini­tia­tive to ex­pand trade by build­ing ports, rail­ways and other in­fra­struc­ture across a vast arc of 65 coun­tries from the South Pa­cific through Asia to Africa and Europe.

Gov­ern­ments in­clud­ing Nepal, Sri Lanka and Thai­land have scrapped or scaled back projects due to high costs or com­plaints too lit­tle work goes to lo­cal com­pa­nies. Sri Lanka, Kenya and other na­tions have run into trou­ble re­pay­ing Chi­nese loans.

“It’s be­come too as­so­ci­ated with debt and China get­ting what it wants,” said Brown. “They are try­ing to get out this more pos­i­tive mes­sage that China is open for busi­ness.” – AP

Photo: EPA

Work­ers la­bor in the Sun­ing ware­house in Nan­jing, Jiangsu prov­ince, China.

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