‘Tough work’ ahead on talks

China pre­pared for worst if 90-day trade truce fails

Global Times US Edition - - FRONT PAGE - By Chen Qingqing

The ap­par­ent China-US trade truce is not a re­sult of uni­lat­eral com­pro­mises by the Chi­nese side, but the ob­vi­ous thaw in trade ten­sions be­tween the world’s two largest economies does sig­nal a de-es­ca­la­tion in the po­ten­tial for “a new cold war” that is re­port­edly contributing to damp­en­ing global growth out­look, Chi­nese of­fi­cials and ex­perts said on Tues­day.

The up­com­ing 90 days of trade ne­go­ti­a­tions are ex­pected to re­quire very tough work and China is fully pre­pared for the worst sce­nar­ios, said ex­perts.

“It’s a good start to see the lead­ers of the two coun­tries sit down and talk amid on­go­ing trade fric­tions, which has helped avoid a full-scale ‘new cold war.’ But if this 90day ne­go­ti­a­tion pe­riod ends badly, we have plenty of coun­ter­mea­sures too,” Jin Can­rong, associate dean of Ren­min Univer­sity of China’s School of In­ter­na­tional Stud­ies, told the Global Times on Tues­day.

US Pres­i­dent Don­ald Trump said in Tweets on Mon­day that

China in­tends to im­me­di­ately pur­chase agri­cul­tural prod­ucts and has also agreed to re­duce and re­move tar­iffs on US-made cars ex­ported to China.

While Trump bragged about the re­sults of his Satur­day meet­ing with Chi­nese Pres­i­dent Xi Jin­ping, China has also wres­tled some con­ces­sions from the US, Jin said.

The US is no longer ob­sessed with the “Made in China 2025” strat­egy and did not at­tack China’s in­dus­trial pol­icy as it has in the past, said Jin.

“This is a pos­i­tive sign for both sides. The US brought up mat­ters such as forced tech­nol­ogy trans­fer and pro­tec­tion of in­tel­lec­tual prop­erty rights [IPR], and we can work hard to find ef­fec­tive solutions to con­crete is­sues in­stead of un­rea­son­able re­quests,” Jin said.

Bei­jing has made nu­mer­ous sin­cere moves in an at­tempt to mit­i­gate the trade fric­tion and Wash­ing­ton should re­spond in kind, in­stead of seek­ing political gains for do­mes­tic con­sump­tion by brag­ging it had eas­ily won con­ces­sions from China, said Chi­nese ob­servers.

Hawks and doves

The US gov­ern­ment has named Robert Lighthizer to head the US team in ne­go­ti­a­tions, but United States Secretary of the Trea­sury Steven Mnuchin, who pre­vi­ously has been more con­cil­ia­tory, will also be very much in­volved in the talks, CNN re­ported on Mon­day,

As US at­tempts to bal­ance wildly di­ver­gent in­ter­ests, its ne­go­tia­tors will in­clude both hawks and doves, Wei Jian­guo, for­mer Chi­nese vice min­is­ter of com­merce, told the Global Times on Tues­day.

“The Chi­nese side may in­clude Vice Premier Liu He, and of­fi­cials from the Min­istry of Com­merce, Na­tional De­vel­op­ment and Re­form Com­mis­sion and oth­ers,” Wei said.

Al­ready there ap­pears to be mis­com­mu­ni­ca­tion and con­fu­sion if not dis­sent among the White House team, which has made con­flict­ing state­ments re­gard­ing the start of the 90-day de­lay in the im­po­si­tion of higher US tar­iffs, said ob­servers.

Larry Kud­low,di­rec­tor of the White House Na­tional Eco­nomic Coun­cil, said the 90-day count­down is to be­gin Jan­uary 1, the Wash­ing­ton Post re­ported on Mon­day.

The White House later con­tra­dicted him, say­ing the clock on trade ne­go­ti­a­tions be­gan De­cem­ber 1, CNN said.

Mei Xinyu, an ex­pert close to the Chi­nese Min­istry of Com­merce, told the Global Times on Tues­day the mis­com­mu­ni­ca­tion in­di­cates con­fu­sion inside the Trump ad­min­is­tra­tion, and that the pre­vi­ously re­ported in­ter­nal fights are con­tin­u­ing.

China’s com­mit­ment

Mnuchin told CNBC on Mon­day that China has put on the ta­ble an of­fer of over $1.2 tril­lion in ad­di­tional com­mit­ments, in­clud­ing pur­chas­ing more Amer­i­can prod­ucts and en­larg­ing mar­ket ac­cess for US firms in­vest­ing in China.

“It’s un­likely that China would make such a spe­cific com­mit­ment, and $1.2 tril­lion is surely only an es­ti­ma­tion made by the US,” Wei said.

China will not back­track and is sure to de­liver on its com­mit­ments by open­ing mul­ti­ple sec­tors of the econ­omy in ac­cor­dance with its own timetable and road map, the for­mer se­nior trade of­fi­cial noted.

Diao Dam­ing, an Amer­i­can stud­ies ex­pert at the Ren­min Univer­sity of China, told the Global Times on Tues­day that fur­ther low­er­ing im­port tar­iffs is not a com­pro­mise but a step for­ward in de­liv­er­ing the Chi­nese gov­ern­ment’s prom­ises to broaden its open­ing-up.

“In­creas­ing im­ports of Amer­i­can prod­ucts will have to be mar­ket driven. For ex­am­ple, af­ter US beef gained ac­cess to the Chi­nese mar­ket last year, it did not at­tract a lot of Chi­nese con­sumers,” he said.

Tough talks

While the lead­ers of China and the US have put at least a tem­po­rary halt on tit-for-tat trade dis­putes, and this progress has given di­rec­tion to bi­lat­eral re­la­tions go­ing for­ward, Chi­nese of­fi­cials and ex­perts are cau­tious in pre­dict­ing the ne­go­ti­a­tions will bring pos­i­tive re­sults, say­ing it’s go­ing to be “very tough work.”

China may agree to buy more Amer­i­can prod­ucts, open up its mar­ket and pro­tect IPR, but “the Chi­nese gov­ern­ment will not ac­cept US de­mands to change our eco­nomic struc­ture or aban­don our in­dus­trial poli­cies,” said Jin, the associate dean of Ren­min Univer­sity.

China and the US, as two world pow­ers, should also seek com­mon in­ter­ests in global af­fairs such as the Iran nu­clear ac­cord and the cri­sis in Syria, and the US needs China’s sup­port on mat­ters like the North Ko­rea nu­clear is­sue, he noted.

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