China accuses Trump of ‘blackmail’ after new tariffs threat

China has so far targeted major American exports to China such as soybeans, above, which brought in $14 billion in sales last year. (AFP)
Updated 19 June 2018
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China accuses Trump of ‘blackmail’ after new tariffs threat

  • Donald Trump asked the US Trade Representative to target $200 billion worth of imports for a 10 percent levy, citing China’s ‘unacceptable’ move to raise its own tariffs.
  • China had offered to ramp up purchases of American goods by $70 billion to help cut its yawning trade surplus with the United States, whereas Trump had demanded a $200 billion deficit cut

BEIJING: Beijing on Tuesday accused Donald Trump of “blackmail” and warned it would retaliate in kind after the US president threatened to impose fresh tariffs on Chinese goods, pushing the world’s two biggest economies closer to a trade war.
Trump said on Monday he had asked the US Trade Representative to target $200 billion worth of imports for a 10 percent levy, citing China’s “unacceptable” move to raise its own tariffs.
He added he would identify an extra $200 billion of goods — for a possible total of $450 billion, or most Chinese imports — “if China increases its tariffs yet again.”
“Further action must be taken to encourage China to change its unfair practices, open its market to United States goods and accept a more balanced trade relationship with the United States,” Trump said in a statement.
Last week, he announced 25 percent tariffs on $50 billion in Chinese imports, prompting Beijing to retaliate with matching duties on US goods.
The US leader warned Friday of “additional tariffs” should Beijing hit back with tit-for-tat measures.
“The trade relationship between the United States and China must be much more equitable,” he said in explaining his latest decision.
“I have an excellent relationship with President Xi (Jinping), and we will continue working together on many issues. But the United States will no longer be taken advantage of on trade by China and other countries in the world.”
China’s commerce ministry immediately responded by saying the US “practice of extreme pressure and blackmail departed from the consensus reached by both sides during multiple negotiations and has also greatly disappointed international society.”
“If the US acts irrationally and issues a list, China will have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures.”
The news hit stock markets in Asia, where Shanghai shed three percent in the morning, Hong Kong lost more than two percent and Tokyo was one percent lower.
Trump is moving forward with the measures after months of sometimes fraught shuttle diplomacy in which Chinese offers to purchase more American goods failed to assuage his grievances over a widening trade imbalance and China’s aggressive industrial development policies.
China had offered to ramp up purchases of American goods by $70 billion to help cut its yawning trade surplus with the United States, whereas Trump had demanded a $200 billion deficit cut.
The China trade offensive is only one side of Trump’s multi-front battle with the United States’ economic partners as he presses ahead with his protectionist “America First” agenda.
Since June 1, steel and aluminum imports from the European Union, Canada and Mexico have been hit with tariffs of 25 percent and 10 percent, respectively.
“This latest action by China clearly indicates its determination to keep the United States at a permanent and unfair disadvantage, which is reflected in our massive $376 billion trade imbalance in goods,” Trump said of China’s retaliatory tariffs.
“This is unacceptable.”
Two decades ago, China’s economy was largely fueled by exports, but it has made progress in rebalancing toward domestic investment and consumption since the global financial crisis erupted last decade — limiting the damage trade tariffs could inflict on Beijing.
Still, strong exports this year have lifted the economy, which is now showing signs of losing steam under the weight of Beijing’s war on debt, launched to clean up financial risks and rein in borrowing-fueled growth.
Initially, 545 US products valued at $34 billion will be targeted by China, mimicking the Trump administration’s tariff rollout.
Beijing wants to “demonstrate that things will be done their way or not at all,” said Christopher Balding, an economics professor at Shenzhen’s HSBC Business School, who believes Chinese policymakers prefer demonstrations of “power and control” over “technical policy rightness.”
“It is a game of chicken,” Balding said.
So far Beijing has targeted major American exports to China such as soybeans, which brought in $14 billion in sales last year, and are grown in states that supported Trump during the 2016 presidential election, as well as other politically important products.
Officials also drew up a second list of $16 billion in chemical and energy products to hit with new tariffs, though China did not announce a date for imposing them.
More American targets are likely to follow as soon as the Trump administration follows through with publishing an expanded tariff list.


China-US trade talks ‘making a final sprint’ — state media

U.S. Treasury Secretary Steven Mnuchin shakes hands with Chinese President Xi Jinping as U.S. Trade Representative Robert Lighthizer, left, and Chinese Vice Premier Liu He, right, look on before proceeding to their meeting at the Great Hall of the People in Beijing, China February 15, 2019. (REUTERS)
Updated 16 February 2019
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China-US trade talks ‘making a final sprint’ — state media

  • US duties on $200 billion in imports from China are set to rise to 25 percent from 10 percent if there is no deal by March 1 to address US demands

SHANGHAI: Chinese state media on Saturday expressed cautious optimism over trade talks between the United States and China, a day after President Xi Jinping said a week of discussions had produced “step-by-step” progress.
Xi made the comments at a meeting on Friday with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin in Beijing, after a week of senior- and deputy-level talks.
The People’s Daily, the official paper of the ruling Communist Party, said in a commentary that Xi’s meeting with US negotiators had affirmed progress made in previous talks and “injected new impetus into the next stage of the development of Sino-US trade relations.”
The talks “have made important progress” for the next round of negotiations in Washington next week, the paper said in its domestic edition.
“It is hoped that the two sides will maintain the good momentum of the current consultations and strive to reach an agreement within the set time limit,” it said.
US duties on $200 billion in imports from China are set to rise to 25 percent from 10 percent if there is no deal by March 1 to address US demands that China curb forced technology transfers and better enforce intellectual property rights.
In its overseas edition, the People’s Daily said “zero-sum thinking and games where you lose and I win can only create losses for both. Only on a basis of mutual respect and equal treatment, through dialogue and consultation, can we find a solution acceptable to both sides.”
An English-language editorial in the Global Times, which is published by the People’s Daily, said news that China had consulted on the text of a memorandum of understanding “shows the two sides have made unprecedented progress.”
“The MOU and next week’s talks both show that the seemingly endless China-US trade negotiations, like a marathon, are making a final sprint,” it said.
The newspapers cautioned that any agreement would have to be in the interests of both the United States and China.
“There are still obstacles to be overcome, and no one should underestimate how daunting a task the two sides face trying to resolve all the differences that have long existed between them in one clean sweep,” the official English-language China Daily said in an editorial.