Threat of tariffs 'a powerful negotiating tactic'

Arturo Kim
June 1, 2018

The Commerce Ministry's statement gave no details of possible new initiatives but promised to "conscientiously implement" the joint statement by China and the USA issued May 19 in which Beijing agreed to "substantially reduce" America's trade deficit with China.

The commerce ministry said earlier Wednesday that Beijing "has the confidence, capability and experience to defend the interests of Chinese people and the core interests of the country" - no matter what measures the United States plans to take.

"What we're having with China is a trade dispute, plain and simple", US National Trade Council Director Peter Navarro said, referring to Mnuchin's May 20 comment that trade action against China was "on hold".

Having already undermined United States national security interests by agreeing to China's precondition to trade talks by easing penalties on ZTE, the administration now appears to be saving face by rattling its saber with new deadlines on investment restrictions and tariffs on China, said Ways & Means Committee Ranking Member Richard Neal.

The US trade sanctions proposed in March include restrictions on Chinese investment, export controls and 25 percent tariffs on as much as $50 billion in Chinese tech goods. "They engage in a whole range of unfair trade practices".

U.S. President Donald Trump and Chinese President Xi Jinping shake hands during a meeting in November. According to China this decision announced by the United States contradicts the decisions made between two in a meeting held in Washington. Politico's profile notes that Ross, who was brought in as a trade hardliner, has been eclipsed by USTRO Robert Lighthizer, who wrote the damning report on China's intellectual property theft in March.

"While obviously more details are needed, this outline represents the kind of actions we have needed to take for a long time, but the president must stick with it and not bargain it away", Schumer said.

Hitting back at the Trump administration's threat to impose a 25 per cent tariff on $50 billion goods imported from China, foreign ministry spokesperson Hua Chunying said, "In global relations, every flip-flop and U-turn by a country will undermine and hurt its own credibility".

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A final list of the imports subject to the tariffs will be released June 15 and the investment restrictions will be announced on June 30.

The White House also says that it will announce and impose investment restrictions and enhanced export controls on Chinese individuals and organizations, to prevent them from acquiring US technology. But according to the White House, the date of 15 June is announced which would finalize the question regarding tariffs.

In response, the Chinese Commerce Ministry said the country is prepared for whatever the USA may impose.

Either way, repeated changes to the United States strategy on China may only bog down talks with Beijing moving forward, Reinsch said.

The IMF maintained its 6.6 per cent growth forecast for China's GDP this year, down from 6.9 per cent last year.

Beijing has previously pledged to retaliate against the 25 percent tariffs.

The China tariffs are back on. Over the last two weeks, it appeared that the Trump administration had retreated from their aggressive policies to contain China's economic expansion in this effort.

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