US ‘insincere’ in defusing trade war

By Li Xuanmin Source:Global Times Published: 2018/8/1 23:03:40

Manufacturing upgrade key to blunting US tariffs: analyst


Mixed signals from the US, including an attempt to restart trade talks with China while spiking tariffs on Chinese imports from 10 to 25 percent, are Trump administration strategies to "test China's bottom line," even as it shows little sincerity in helping defuse the heightened bilateral trade row, experts said.

US pressure on trade won't work, and rules and promises must prevail at a China-US dialogue, Foreign Ministry spokesperson Geng Shuang told a press briefing in Beijing on Wednesday.

"The Chinese government has always upheld the use of dialogue to resolve trade issues, but China will retaliate if the US takes further steps to hinder trade," Geng said.

The comment comes after Bloomberg reported that representatives of US Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are talking privately as they try to restart negotiations to avoid a full-blown trade war.

While the move hints at the possibility of restarting negotiations, the Trump administration is also planning to slap a 25 percent tariff on $200 billion in Chinese imports from the initial proposal of 10 percent, Reuters reported Tuesday.

Lin Guijun, vice president of University of International Business and Economics, described the US actions as "bullying you after inviting you for dinner" to determine the Chinese government's bottom line.

"This is a one-two punch, indicating US cunning," Bai Ming, deputy director of the Ministry of Commerce's International Market Research Institute, told the Global Times on Tuesday. He also predicted that negotiations could collapse again because the US shows little sincerity in negotiating with China.

The two sides have held three rounds of dialogues in the past three months, yet have failed to achieve any significant results.

"It's ridiculous… The US looks to reap benefits without having to make concessions," Lin told the Global Times on Wednesday. "The US feels threatened by China's fast-rising technology sector. And the US started a trade war with China because it knows that, within a decade, it won't be able to play its chips like today."

Bai suggested that China should "fight to the end" and take countermeasures, such as slapping tariffs on more US goods and restricting access to US companies in certain sectors in China. More importantly, China should more quickly upgrade its manufacturing industry, which is the best way to limit the tariffs' potential impact.



Limited impact for now
 

However, experts stressed that Trump's attitude on the China-US trade row will likely change after the US economy bears the brunt in the near future.

The next round of tariffs on $200 billion in Chinese goods is set to take effect after a public hearing in August, reports said. Among the Chinese imports included are food products, chemicals and consumer goods ranging from dog food, furniture, and carpets to car tires, bicycles, baseball gloves and beauty products, Reuters reported.

"Trade tensions are still in the preliminary stage, which translates to a limited impact on the US economy," Lian Ping, chief economist at the Bank of Communications, told the Global Times.

But after the second wave of tariffs is imposed on Chinese imports, prices of US consumer goods will substantially rise and the US economy will also suffer greater uncertainty, which in turn could trigger divisions in the Trump administration toward China, Lian noted.

A recent example is the Trump administration's concession on EU tariffs, which observers said was caused by mounting criticism in the US. Last week, the US and EU agreed to work toward zero tariffs on non-auto industrial goods as well as to reduce barriers and increase trade.

"China must be resilient and patient in dealing with the trade row, and consider it a protracted war," Lian told the Global Times on Wednesday. "The longer [trade tensions] last, the more the US would be willing to talk to us on an equal footing."



Posted in: POLITICS,DIPLOMACY

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