China won’t hold trade talks unless Donald Trump stops threats

Daniel Fowler
September 25, 2018

President Trump, who has accused Beijing of exploiting the United States on trade, wants to reduce China's $375.6 billion goods trade surplus with America.

New US tariffs on $200 billion worth of Chinese imports kicked in on Monday.

Even before Trump's election, the United States has complained vigorously that China has been unfair to U.S. businesses and has stolen technology by forcing firms to reveal secrets as a condition to operate in the fast-growing Asian economy.

A day after both sides heaped fresh tariffs on each other's goods, vice-commerce minister Wang Shouwen said the resumption of talks on the matter depended on the "will" of the US. Negotiations "cannot be carried out under the threat of tariffs".

Rob Carnell, ING's chief Asia economist, said in a note to clients that in the absence of any incentives Beijing would likely hold off on any further negotiations for now.

Eswar Prasad, former head of the International Monetary Fund's China division told the Washington Post: "The end game in the U.S". In response, China retaliated, slapping tariffs on $US60 billion worth of U.S. goods entering the country.

India and Russian Federation have also announced retaliatory tariffs on American products.

The United States stands to gain more from Sino-US trade, China's global trade representative Fu Ziying, said at the same press conference.

China on Saturday called off planned trade talks with U.S. officials with a move by the U.S. State Department to sanction China's defense agency and its director on Thursday contributing to the decision, according to people familiar with the situation.

Hopes for talks to resolve the issue appeared to have been dealt a blow as The Wall Street Journal reported Beijing cancelled the visit of a negotiating team expected September 27-28 in Washington.

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Efforts at diplomacy have failed, with no breakthroughs since high-level talks began in May.

The latest volley against Beijing brings the amount of goods hit by duties to more than US$250 billion, about half of China's United States exports, with USA consumers set to increasingly feel the pain.

Still, the US remains open to talks, Lindsay Walters, deputy White House press secretary, said in an emailed statement.

China President Xi Jinping aims to make Taiwan unification a "legacy project" of his leadership, says one expert.

China opposes all U.S. military sales to Taiwan.

Earlier, the two sides imposed 25 per cent penalties on $34 billion of each other's goods in July and another $16 billion in August. This latest round of tariffs is no exception.

"Retailers are already facing a tidal wave of tariffs". Though Beijing has not revealed what such steps might be, business executives and analysts say it could withhold exports of certain products to the USA or create more administrative red tape for American companies operating in China.

The ministry's list includes big-ticket items like liquefied natural gas, lumber and electronics as well as everything from peppermint oil to pig hides to cocoa butter to condoms.

The Trump administration has "has brazenly preached unilateralism, protectionism and economic hegemony, making false accusations against many countries and regions, particularly China, intimidating other countries through economic measures such as imposing tariffs, and attempting to impose its own interests on China through extreme pressure", the official Xinhua News Agency said.

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