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Trump: China has 'much to give' on trade

May 16, 2018

The US president has raised the pressure in trade talks with China, urging Beijing to relinquish its cherished trade privileges with the US. He also insisted that his stance on sanctions against ZTE hadn't changed.

USA Republikaner Vorwahlen Donald Trump Geste
Image: picture-alliance/AP Photo/J. Locher

As a second round of crucial trade talks between Washington and Beijing opens this week, the US president made abundantly clear again that he wants China to offer remedies to current bilateral trade practices that he considers to be "unfair" and costing American jobs.

On Wednesday, Donald Trump urged China to make substantial proposals for a trade deal, writing on the messaging service Twitter that the US side had "very little to give."

The meetings in Washington this week follow trade talks in Beijing earlier this month where the two countries failed to reach an agreement on the long list of US demands, including a $200 billion (€169 billion) reduction in China's trade surplus with the US, which totaled $375 billion last year.

Trump's top trade and economic officials, including US Treasury Secretary Steven Mnuchin, are meeting with Chinese Vice Premier Liu He and central bank governor Yi Gang to discuss concerns ranging from intellectual property protections to farm goods to steel capacity.

Read more: Trump seeks emergency powers to curb China's tech advance

The talks are overshadowed by concerns about an all-out trade war between the world's two biggest economies after Trump has threatened to impose tariffs on up to $150 billion worth of imports from China, prompting Beijing to retaliate.

ZTE bargaining chip

In a surprise announcement on Sunday, the US president initially appeared to have offered an olive branch to Beijing under efforts to facilitate trade talks. He called on US officials to revisit American penalties for Chinese company ZTE for flouting sanctions on trade with Iran and North Korea.

ZTE was fined $1.2 billion in March 2017, but last month it was hit with a steeper sanction, prohibiting US firms from supplying the telecommunication equipment maker with needed parts.

ZTE, which employs 80,000 people, said last week its major operations had "ceased" after being banned for seven years from buying crucial American technology, raising the possibility of its collapse.

Trump said Sunday he and Chinese President Xi Jinping were exploring ways to get the company "back into business fast." However, after strong criticism of Trump's apparent policy U-turn by US lawmakers, the US president tweeted on Wednesday that nothing had been decided yet.

Far apart on deal

In a live interview with Politico news outlet on Tuesday, White House economic adviser Larry Kudlow said that both parties in the trade negotiations must take action to reach an agreement.

"Both sides should try to lower tariffs as much as possible, and to take down non-tariff barriers wherever they are," he said, adding: "Free and open trade, I think that's the solution."

However, the US ambassador to China, Terry Branstad, who took part in the talks in Beijing, acknowledged on the same day that the two sides were "still very far apart." Speaking at a conference in Tokyo, Branstad said the Chinese appeared "taken back" by the significance of the list of remedies sought by the US from them.

Branstad also noted that China had not met pledges to open up its insurance and financial services area, as well as reduce auto tariffs, and that Trump would like to see a "dramatic increase" in food exports to China. Increasing US exports of liquefied natural gas could also be an area where the two countries could agree, he added.

China says its economy can withstand trade tariffs

Chinese muscle-flexing

Meanwhile, China has stepped up inspections of key US imports such as pork and automobiles to show their US counterparts the value of access to China's huge markets for American goods and firms.

"We increased the inspection ratio of American pork," China's Customs Bureau told news agency AFP on Wednesday, calling the practice "in line with international norms." It added that inspections came after "we found there were problems with American pork", the department said without providing details.

Reports have also said inspectors are taking similar action against US car giants such as Ford as well as waste imports from the US and other products. The customs administration said US car imports were quickly deteriorating in quality.

"In the first four months of the year, major car ports in China detected a total of 652 batches of cars from the US — totaling 4,360 vehicles worth $312.5 million — that were not up to standard," the customs administration told AFP, adding that this was "a relatively quick pace of growth."

The moves against waste imports have thrown the American recycling industry into a tailspin as China was one of the most important destinations for US trash. Citing statistics showing US waste imports failing to meet standards, China's customs department said it took action to "protect people's lives and health and safeguard the ecological environment."

uhe/jd (Reuters, AFP, dpa)