The trade war should not be scorned. US President Trump announced that he would levy a tax on 60 billion U.S. dollars on Chinese exports to the United States. It was once regarded as the most critical situation facing China since its accession to the WTO. However, the two sides quickly moved into the negotiation mode and the fierce conflict broke out.
This does not mean that the cloud has passed. Although Trump’s behavior is seen as a rash, there are consensus in the United States on the pursuit of China’s changes in intellectual property practices, restrictions on China’s acquisition of key technologies in the United States, and further opening up of China. A wind that has turned to China policy has already started. China's efforts to promote strategic industries with the power of the state are seen as a means of unfair competition. Concerns about this model are not the only ones that Trump has risen to, and are not limited to the United States.
China is now the second largest economy in the world, and the global spillover effects of its economic policies cannot be ignored. As Long Yongtu, the chief representative of China's WTO accession negotiations, said that the best way to deal with trade disputes and trade deficits is that China has shown a more open attitude.
--editor
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Caijing reporter Cai Tingyu Huang Chengyu / Wen Yuanxue / editor
Minnesota's 35-year-old soybean farmer, Michael Petefish, tried to put hope in 2019. Not only because the market demand in 2018 is not as good as last year, but the cost has increased slightly, and because of the new variables in exports.
Under the cloud of Sino-US trade wars, American soybean farmers have become potential victims. "The situation is very uncertain now, and the measures for self-protection are very limited." Pierre Fei Xue told the Caijing reporter.
The US soybean industry organization has recently ran in Washington, in addition to making a voice to the Trump administration and holding talks with the Chinese Embassy in the United States. However, the White House still does not respond to their demands, which makes them somewhat disappointed.
There may be signs of a delay in the trade conflict between the two countries, which may make them feel a little gratified. On March 28th, local time, the most tough US trade negotiator, Wright Heze, said that the number of public notice days for the list of tariffed products in China will be extended from 30 days to 60 days according to the results of the 301 investigation. This means that June No tariffs will be added to Chinese related products before. He also said in the interview that China and the United States hope to avoid tariff wars through negotiations.
Although the Ministry of Commerce announced in the early morning of April 1st that it will impose a 15% or 25% tariff on 128 products imported from the United States from April 2, 2018, including tariffs on 120 imported products such as fruits and products. The tax rate is 15%, and the tariff rate on 8 imported goods such as pork and products is 25%. However, this measure is still aimed at the 232 measures of the United States on the taxation of imported steel and aluminum, but did not directly attack the United States against China. The 301 investigation, counter-measures are still restrained.
This situation did not completely relax the business people. According to Claire Reade, China Affairs Assistant to the former US Trade Representative Office, the United States is becoming a new and destructive trading country. Unfamiliar weapons and new ideas have determined that the United States is facing a China Difficult negotiations, a brief trade friction or a serious trade war, and even a new positioning of US policy. "There can be very little certain, and the result depends on how China and the US understand each other and how realistic their goals are," said Lei Ming.
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(The president of the American Soybean Association pointed out that crop prices have fallen by 40% in the past five years, resulting in a 50% drop in farm income. “The demand from China is the mainstay of soybean prices. If demand falls, prices will fall, many farms will not make ends meet, or even continue. Cultivation". Figure / Reuters)
The American Soybean Association will continue to pressure the government. The president of the association, John Heisdorffer, told the Caijing reporter: "We still want to sit down with the president and talk to him about how to expand rather than restrict trade." Hessdorf is from Iowa. Soybeans account for nearly 50% of his farm sales. In addition to soybeans, US pork exporters and fruit growers can be victims.
Trump announced at the White House on March 22 that it would impose tariffs on Chinese products. At the same time, its government took two other tough measures against China in the days before and after: the implementation of the US free navigation rights and senior State Council officials in the South China Sea visited Taiwan. And with Taiwan’s leaders on the same stage.
What is the specific goal of Trump's trade policy? Whether there is an overall consideration of China policy behind it, these all make the outside world suspicion.
Although there are many criticisms of Trump’s behavior, it is acknowledged that in the United States, a trend toward China’s policy has been set aside, requiring China to change its approach to intellectual property rights and restricting China’s acquisition of key technologies in the United States. There is considerable consensus on issues such as further openness. Huang Yiping, a professor at the National Development Research Institute of Peking University, believes that if China is arrogant in this situation and disrupts domestic reform steps, it will not pay off. At the same time, China should have a more open posture on the international stage, so that other countries can get your economy. The benefits of development, thereby establishing their position.
What is Trump's goal?
Failure to act in accordance with common sense and undermining global trade rules are two of the characteristics of Trump's trade policy. Since taking office, Trump has renegotiated trade agreements signed by the United States in the name of reducing trade deficits, and then adopted unilateral sanctions to declare tariffs on certain imported products, including steel and aluminum; further on March 22 Announced the 301 investigation report and announced a 25% tariff on China's $60 billion product.
According to the Office of the Trade Representative, US tariffs on Chinese products will be concentrated on advanced technology products, including automated machine tools, space equipment, aviation, marine, high-tech transportation, new energy vehicles and equipment, and agricultural equipment.
Trump government officials said the tariff levies on related products would cause Chinese companies to lose their motives for export.
This intimidation strategy has had a deterrent effect on some opponents. The Trump administration first quoted Section 232 on February 16th, announcing a 25% and 10% tariff on imported steel and aluminum, respectively, on the grounds that imported steel and aluminum affected national security, and then used the temporary exemption. Renewed trade talks with the European Union, Mexico, South Korea, Canada, Argentina and Brazil, and even asked them to unite in the trade dispute with China. Other countries that are not exempted are also eager to negotiate with the United States.
However, when there is a direct trade dispute with China, the outside world is puzzled by the integration of Trump's strategy and tactics. US Congressional Research (Congressional think tank) Asian trade and finance expert Wayne Morrison told Caijing reporter: "What exactly does Trump want? Is it (processing) 301 investigation of intellectual property issues or trade deficits? This needs to be clarified. If it is intellectual property rights, the two sides should make this a top priority and immediately hold an economic dialogue focusing on this issue; when the negotiations progress, the threats to be imposed may be delayed or even cancelled."
US Ambassador to China Branstad said on March 27 that Trump's goal is to reduce the trade deficit and intellectual property rights. After all, the bilateral trade deficit is growing, and Trump wants to see the numbers develop in the other direction, for example. China has reduced the US trade deficit by opening up the pharmaceutical and medical device markets.
If Trump's goal is to reduce the deficit, it is relatively easy to achieve, China can buy more soybeans, beef, natural gas and Boeing aircraft, "but what is the bottom line of what is not obvious", Strategy and International Research Center fee and China research Gan Side, deputy director of the project, said.
In a statement announcing the results of the 301 investigation, Trump said, "This is the first of many investigations." Xu Chengjin, an assistant researcher at the International Center for Economic and Technical Cooperation of the Ministry of Industry and Information Technology, pre-judges the Caijing reporter. The United States may also take measures against overcapacity and China’s Internet policy. The US Special Note 301 investigation does not include China's Internet policy has caused great losses to the United States, and there are great contradictions between China and the United States on data local storage and cross-border data transmission restrictions.
"This is not a trade deficit issue.
This is an industry competition issue."
In the eyes of economists and business people, the trade deficit between China and the United States should not be a problem at all, but an inevitable outcome of the global industrial chain and the intricate economic links between the two sides.
In 2017, the US trade deficit with China was US$375.2 billion. The US imports from China are mainly communications products, computer equipment, apparel, semiconductors and other parts. The top five products exported from the United States to China are aviation products and parts, and oil extraction. Grain, steam locomotive parts, semiconductors and related electronics, oil and gas.
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(US trade statistics show that between 2002 and 2017, US exports to China increased by 491.2%, from US$22 billion to US$130 billion. China is currently the third largest commodity export market in the US, second only to Canada. And Mexico. Figure / Reuters)
The US trade and financial expert Morrison's report submitted in March pointed out that under the global manufacturing supply chain, China and the United States almost reached the point that "there are American parts in Chinese products and Chinese parts in American products." Take Apple Computer as an example. It outsources manufacturing to more than 200 companies and manufactures it in more than 900 factories around the world. China has 358, 137 in Japan and 64 in the US. Of the 10 chip factories Intel supplies to Apple, three are in the US and two are in China.
The main reason for the Sino-US trade deficit comes from the Pan-Pacific 601099, which includes the manufacturing industry chain of Japan, Taiwan and Hong Kong moving to China. According to the US Trade Commission, the proportion of imported parts from the Pan-Pacific region in the United States was 47.1% in 1990. In 2017, this ratio has hardly changed. What has changed is the proportion of Chinese manufacturing: in China, the proportion of manufacturing in China was 7.6% in 1990, and it has increased to 55.4% in 2017. At the same time, the proportion of Japanese parts and components exported to the United States fell sharply, accounting for 23.8% in 1990. It will only account for 7% by 2017.
In addition to the close industrial chain links, the United States has maintained a trade surplus with China for a long time. According to statistics from the Ministry of Commerce of China, from January to May 2017, China’s service trade deficit with the United States reached US$23 billion, a year-on-year increase of 17%. The trade deficit with the US for 2016 was $38.1 billion.
In China's view, the US trade representative has proposed that the industry will be taxed, and it will not help the deficit.
Yan Ming, director of the Institute of Foreign Trade of the Ministry of Commerce, has begun to study which industries will be affected by the United States, which has revealed that it will levy taxes on 60 billion US dollars of products. "The nine major industries announced are inconsistent with his original intention. In fact, the real (worry) of his heart has been announced. The core is not a deficit. He is playing against your future." Yan Ming told the Caijing reporter. .
Commodities with large US-China trade deficits such as mobile phones ($43.7 billion), computers ($36.8 billion), and toys ($12.2 billion), furniture, footwear, and other consumer goods are not on the list. This reflects the Trump administration's full consideration of the impact of the industrial chain and the impact of trade wars on the living standards of the American people.
Yan Ming’s full-caliber statistics based on customs data found that the nine major industries listed in the United States are difficult to reach the level of 60 billion US dollars: all high-performance medical devices combined with 1.3 billion US dollars, biomedical 1.3 billion US dollars, agricultural machinery and equipment The same is true for industrial robots of 420 million US dollars, even if it contains all mechanical devices with independent functions, it is only 800 million US dollars. In addition, aviation, new materials, biomedicine, etc. are all industries in the United States that have a surplus.
In the 301-page 301 investigation report, the word "deficit" appeared only once and appeared when Trump mentioned the background of trade policy.
"This is not a trade deficit problem, this is an issue of industrial competition." Xu Chengjin believes.
The United States has been quite vocal about "Made in China 2025", including Trump himself and Commerce Minister Ross. On many occasions, Ross said that the most unacceptable thing is that they are overtaken by China in the high-tech industry. The 301 survey report also lists such figures: in the high-end technology manufacturing industry, the United States has a global share of 29%, followed by China with 27%.
Intellectual property protection dispute
Compared with the different interpretations of the trade deficits in the United States, Washington’s dissatisfaction with China’s technology transfer and intellectual property rights is a rare consensus.
Lee Branstetter, a senior trade expert who served as President Obama’s economic adviser and a professor at Carnegie Mellon University, pointed out to the Caijing reporter that in the eyes of American officials and officials, China’s goal is to be a domestic company. Instead of Europe and the United States, use market access as a bargaining chip to accelerate technology. "I think Washington is very determined to solve this problem, and the frustration in Europe and America has reached a new high."
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(Creative Design / Li Li)
In announcing the results of the 301 investigation, US Trade Representative Wright Heze emphasized that high technology is the backbone of the US economic development. The 301 investigation concluded that China has four acts that harm US interests in intellectual property rights: when US companies invest in China, they are required to transfer technology in order to obtain relevant licenses; some US companies are subject to investment restrictions when investing in China, and then are required to Chinese peers transfer technology; US advanced technology and companies with large amounts of intellectual property have recently been systematically acquired; China’s theft of intellectual property. The investigation report also stated that China’s various infringements caused the United States to lose an average of $50 billion a year.
Due to the catch-up of Chinese manufacturing technology, especially after the launch of “Made in China 2025â€, the United States is worried about the competition between the United States and China from the business, academic circles and the government. At the same time, it believes that the United States is passive in its interaction with China’s trade policy. The Chinese government has not responded specifically to the difficulties it has encountered.
Terence Stewart, a lawyer who represented many US companies in the 301 investigation hearing, said that the United States tried to raise intellectual property issues on various occasions and forums, but did not receive much response. The latest survey by the American Chamber of Commerce shows that the mainstream opinion of the Chamber of Commerce hopes that the US government can speak strongly for a fair playing field and reciprocal treatment.
Although the United States has common goals, Trump’s practice of levying tariffs has caused many companies to worry that the problem will not be solved, but will cause more harm.
The US Trade Commission issued a document stating that the Chamber of Commerce agrees with the Trump administration that the status of technology transfer and the protection of intellectual property rights in China really need to be taken seriously, but American companies hope to see solutions to these problems, not just the last may cause greater Unilateral damage increases tariff sanctions.
Some scholars believe that the Trump administration will continue to exert pressure before progress. "But I am not sure if Beijing has this willingness. I am not even sure that this will be negotiable for China," Brantsted said.
On the issue of intellectual property rights, China and the United States clearly have different interpretations. Cui Tiankai, Chinese ambassador to the United States, responded by saying, "If the United States feels that technology is its own family, this attitude is a manifestation of discrimination against other countries."
On October 10 last year, the China International Chamber of Commerce, the China General Chamber of Commerce, and the Chamber of Commerce for Electrical and Mechanical Industry went to the United States to participate in the 301 investigation hearing. The China International Chamber of Commerce on behalf of the Chinese business community provided more than 700 pages of comments and evidence to the US.
Chen Zhou, vice president of the China International Chamber of Commerce, said at the hearing that the Chinese and American business communities have experienced a significant improvement in China's intellectual property protection and business environment. In the field of technology transfer that the US is concerned about, both Chinese and foreign companies conduct equal consultations, independent decisions, and paid transactions. The attribution of new R&D technology based on the transfer technology is also entirely determined by commercial negotiations between enterprises. Chinese companies investing and acquiring in the United States are independent choices of enterprises in the context of global economic integration. They fully follow the principles of commercial considerations and marketization, and the acquisition transactions are in compliance with US law. In addition, both China and the United States are victims of cyberattacks. The two sides should strengthen cooperation and work together to combat cybercrime and steal intellectual property rights and trade secrets through the Internet.
China has acknowledged that it has done a bit of a lack of intellectual property protection in the past, but in recent years it has made tremendous improvements in law enforcement. According to statistics, the rate of success in patent infringement lawsuits filed by foreign companies in China has reached 80%. The amount of compensation provided by the state has increased from the previous 10,000 to 1 million yuan to 100,000 to 5 million yuan. China has also established three intellectual property courts.
In the newly-recognized institutional reform plan of the State Council, the State Intellectual Property Office was re-established, which will integrate the functions related to the protection of intellectual property rights, which will help solve the problem of difficulty in obtaining evidence for intellectual property protection, long cycle, high cost and low compensation.
Before and after joining the WTO in 2001, in order to comply with internationally accepted rules, China has systematically revised the intellectual property laws such as the Intellectual Property Law and the Patent Law. In 2008, the Outline of the National Intellectual Property Strategy was promulgated and implemented to the national strategic level. Since then, the National Leading Group for Combating Infringement of Intellectual Property Rights and the Production and Sale of Counterfeit and Inferior Commodities has been established. The legislation, law enforcement and judicial actions based on combating infringement and counterfeiting have been greatly improved.
According to the World Intellectual Property Organization's March 21 report, in 2017 China has become the second largest source of international patent applications under the Patent Cooperation Treaty, only after the United States. The organization’s Director General, Francis Gurry, said: “China’s use of the international patent system has increased significantly.â€
Limited investment: for "Made in China 2025"
China has shown a strong willingness to invest in the US high-tech sector in the past three years. From 2013 to 2016, China's average annual investment in high-tech and innovation industries in the United States is about $9 billion.
Trump instructed the US Treasury Department within 60 days to clarify how to establish a mechanism to help limit China's investment in key areas of the United States.
Stephen Heifetz, who worked for the US Foreign Investment Committee (Cfius) and handled hundreds of reviews, is now a partner at Wilson Sonsini Goodrich & Rosati, told the Caijing reporter, Trump asked the Treasury to issue The new measures may be broader than the Cfius range and are a completely different tool that may use economic sanctions as a tool to limit Chinese investment.
Bloomberg quoted sources as saying that the United States is considering using the International Emergency Economic Power Act to curb China's acquisition of sensitive technology in the United States. The International Emergency Economic Power Act, introduced in 1977, allows the president to declare a state of emergency and, in this connection, suspend transactions that threaten national security.
Xu Chengjin also believes that in the next period of time, China's investment in the US high-tech industry will be very limited.
Concerns about the threat to China's technological superiority are highlighted by the veto of Broadcom's acquisition of Qualcomm. In a presidential decree issued on March 12, Trump prohibited Broadcom from acquiring Qualcomm in any form. The presidential decree is based on a letter from Cfius, which states that "Broadcom lacks R&D on 5G technology, which may cause Huawei to dominate the 5G world and threaten US national security."
The US Congress is also pushing for reform of Cfius. If the reforms will greatly expand the power of Cfius, further increase China's direct investment in the United States faces new barriers. On November 8 last year, members of the Senate and House of Representatives submitted a bill called the Foreign Investment Risk Assessment Modernization Act (2017), seeking to broaden the scope of Cfius's review and change the review process and scope. One of the drafters of the bill, Republican Congressman Rep. Robert Pittenger, claimed that one of the intentions of the bill was to target "Made in China 2025." "We want to ensure that US technology stays ahead and not let foreign governments pass any Channels to acquire these technologies."
In order to promote the above reforms into law, the House of Representatives and the Senate conducted two hearings. The records show that almost every member of the parliament’s remarks point to China.
James Lewis, senior vice president and technical policy expert at the Center for Strategic and International Studies, is one of the spokespersons for the Senate hearing. He pointed out that the United States regards China as a strategic opponent and is looking for ways to bypass the protection of Cfius. China's industrial policy is the biggest challenge of Cfius.
One of the main ideas of the Cfius reform is to expand the jurisdiction and expand the review from focusing only on mergers and acquisitions to joint ventures, that is, to prevent US “key technology companies†from providing intellectual property rights and related support to foreign investors through joint ventures. occur.
The Pentagon report used Canyon Bridge Capital's acquisition of semiconductor company Lattice as an example of evading government regulation. The report said that the creation of a private equity fund with a relationship with China was to cover up the source of funds and to make Cfius approve the “probability increase†of the transaction. On September 14, 2017, the Guqiao Fund’s acquisition of Lattice was stopped by Trump.
In addition, the bill will strengthen the review of certain emerging technologies that may exceed the United States. More and more transactions involve start-ups in cutting-edge technology industries, which are often too small to meet the threshold for Cfius review.
In this regard, the Act stipulates that if a foreign government owns 25% or more of the foreign investor's equity, or the investor's information is difficult to obtain, these acquisitions will trigger Cfius mandatory declaration, and the regulatory authorities can stipulate which declarations are submitted; May result in large civil fines and bans or cancellations.
However, the above reforms did not solve the problem of the transparency of Cfius being criticized. The definition of “emerging technologies and key technologies†is not clear. Cfius usually only announces the outcome of the ruling without notifying the reason for the veto, which may often lead to tensions between the US and China.
Lou Jiwei, chairman of the National Social Security Fund Council and former chairman of CIC, said that the rules of the foreign investment review committee led by the US Treasury Department are highly opaque and full of uncertainty. "There are too many examples in this area. I have encountered a lot in CIC. The products of Chinese companies and even the products of American corporations with Chinese shares have been treated unfairly in the United States. I have also done a lot of consultations."
In response to the US-China Business Council Vice Chairman Peng Jiening, Cfius really needs to improve its transparency. "We encourage the US government to be transparent, especially in examining foreign investment, including Chinese investment cases, and avoid using national security as a protection. An excuse."
The 301 investigation report on investment claims that US advanced technology and companies with large amounts of intellectual property rights have recently been systematically acquired. The report stated that “China’s foreign direct investment is driven by non-market factors, which are derived from the extensive intervention of the Chinese government. To achieve industrial policy goals." However, according to the China Foreign Investment Report of the National Development and Reform Commission, the number of foreign-invested private enterprises has exceeded that of state-owned enterprises, accounting for more than 60% of the total number of enterprises.
One possible scenario is that Cfius will eventually present an exact list. Lewis said that it is similar to the export control list listed by the Ministry of Defense and the Ministry of Commerce. The United States will study the technologies listed in the China Five-Year Plan or "Made in China 2025" when formulating the technologies involved in the list.
Business group concerns
After Trump announced that he would impose tariffs on Chinese products, Cui Tiankai, the Chinese ambassador to the United States, pointed out that China does not intend to fight trade with any country, but if the other party provokes, China will accompany the end to see who can stick to the end.
According to US trade statistics, between 2002 and 2017, US exports to China increased by 491.2%, from US$22 billion to US$130 billion. China is currently the third largest commodity export market in the US, second only to Canada and Mexico.
In 2017, China was the second largest agricultural product in the United States, with a total export volume of US$19.6 billion, of which 63% was soybean. China purchased US$1.1 billion worth of pork last year, making it the third largest export market for US pork. In 2016, 3 million Chinese tourists visited the United States, and Chinese tourists spent US$33 billion on education including education.
China's huge market size and market potential are one reason why US companies cannot ignore the Chinese market. China is currently the largest telecommunications market with 1.36 billion subscribers. Boeing shipped 202 aircraft to China in 2017, accounting for 26% of its global sales. Boeing estimates that between 2017 and 2020, China needs 7,240 new aircraft. Since 2010, the number of vehicles sold by GM in China has begun to exceed that of the United States.
The American Chamber of Commerce Chairman Cai Ruide described the commercial group’s tariff measures proposed by the Trump administration and the possible retaliation that may be caused by China’s investment in the United States, the possible damage to the Chinese and American economies and even the world. Worried.
Because the state of Washington where Boeing is located is not a Trump ticket, and even if the order is cancelled, it will not necessarily benefit the competitor Airbus. The United States does not seem to care about whether Boeing is a target of sanctions.
The outside world believes that another big chip in China's hands - the seven central and western states where the main soybean producing areas are located, is completely different from the Trump administration. For example, in the state of Minnesota where Pierre Fisher is located, the state has 28,000 soybean farmers. The state also grows corn and raises livestock, with a total population of 85,000.
The president of the American Soybean Association, Hessdorf, pointed out to the Caijing reporter that if they become targets of sanctions, the days of the farm will be worse. Crop prices have fallen by 40% in the past five years, resulting in a 50% drop in farm income. “The demand from China is the mainstay of soybean prices. If demand falls, prices will fall, and many farms will not be able to make ends meet or even continue farming.â€
Hessdorf also stressed that US soybeans have been operating in the Chinese market for 30 years and spent their efforts to get rid of rivals Brazil and Argentina. "Our opponents will be happy to receive our share, and the lost market will not be able to get back quickly." ". The Chinese market is worth $14 billion, and it is almost impossible to find a replacement market.
The appeal to the soybean group, the US Department of Agriculture said it will protect the rights and interests of farmers, but Piefike believes that the government can do limited, and finally pay the bill is the farmer. This has become a factor in his next vote. "No matter what happens, politicians need to be responsible."
Trump’s such tough trade protection measures were also considered to have considered the midterm elections held in November.
Because of the mutual restraint between the Chinese and American economies, Trump is trying to find a way to change the status quo, and whether American society can tolerate it is still a question mark. Derek Scissors, an economist at the American Enterprise Institute, a conservative think tank, points out that if you want to change the status quo, it will be "a long and painful process" for the United States.
Morrison suggested that if there are four kinds of deterioration, the Trump administration may stop putting pressure on it. In these four cases, the US stock market has fallen sharply and continuously. The Chinese newspaper has copied products such as Boeing and soybeans, which has led to a sharp decline in US exports to China. China has reduced its holdings of US Treasury bonds for a short period of time, and the prices of consumer products have risen sharply. . China currently holds US$1.18 trillion in US Treasury bonds. Some media reports that US Treasury officials are worried that if the national debt is sold off, the US economy will face pressure to collapse.
The Organisation for Economic Co-operation and Development (OECD) warned that if China, the United States, and the European Union raise tariffs, the cost will increase by 10%, global trade will decrease by 6%, and global GDP will fall by 1.4%.
Reform and opening up is still essential
The global industrial chain and low-priced goods from China have improved the living standards of the American people... These economic theories do not seem to be the reason for convincing Trump that many people in the industry are counting on China to exercise restraint and avoid the escalation of trade wars.
On the second day of Trump's announcement of the 301 investigation on March 22, the Chinese Ministry of Commerce proposed to impose tariffs on some products imported from the United States, involving US exports of about US$3 billion to China, including fresh fruits and dried fruits. Nut products, wine, pork and products, seamless steel pipes and other categories.
China’s action is aimed at the “232 measures†that the United States imposed a tax on steel and aluminum products the previous week. "The reason why I responded with 232 is because the response 301 needs to be much more prudent and the problems involved are more complicated." Xu Chengjin said, "This response takes into account many practical issues. The trade surplus of more than 300 billion US dollars per year explains to some extent. China’s dependence on the US market is higher than that of the United States. It’s not afraid, but fighting trade is not in our national interest, so we have to deal with it rationally and peacefully.â€
Behind this restraint is the basic judgment of the Chinese side. Several scholars interviewed by Caijing reporters believe that Trump’s tough stance is a strategy of exerting the highest pressure and forcing opponents to negotiate. In this case, China’s response needs to leave room for the next negotiation. .
Although the two sides have fought fiercely in the past week, the two countries may have quietly started negotiations. The Wall Street Journal quoted sources as saying that US Treasury Secretarys Mnuchin and Wright Heze sent a letter to Vice Premier Liu He last week, and Mnuchin is considering going to Beijing to promote relevant negotiations.
Branstad, the US ambassador who once served as the chief producer of soybeans and has been governor of Iowa for many years, said that President Xi Jinping, who he knows, is a master of openness and opportunity creation. The current goal is to hope that China will accelerate its implementation of its commitments.
Yan Ming analysis believes that Trump's goal may be on the one hand to pursue increased US exports to China, and on the other hand, China's domestic market opening.
Last year, I participated in the analysis of the 100-day plan of China and the United States. China has great sincerity in reducing the deficit with the US. Imports of crude oil, natural gas, soybeans and wheat have all increased substantially, but structural problems between China and the United States have led to shortcomings in commodity deficits. Time is difficult to completely reverse and needs to be solved by increasing imports.
The Caijing reporter was informed that in order to further expand imports, relevant departments are drafting guidance on expanding imports to promote the balance of foreign trade, which is expected to be released soon.
However, considering that these major commodities are already at a high level in China, if the United States does not relax the export of high-tech products and other export control standards, it is still not optimistic. "If the US export control falls to the level of the EU and Brazil, the difference will be immediately Drastically reduced." Yan Ming said.
In terms of opening up, the report of the 19th National Congress has proposed to build a modern economic system and promote the formation of a new pattern of comprehensive opening up.
On March 25, Vice Minister of Commerce Wang Shouwen said at the China Development Forum that foreign investors are particularly concerned about credit investigations, rating services, accounting, auditing, e-commerce, battery manufacturing for new energy vehicles, and manufacturing of rail transit equipment. In the field, China has fully liberalized in the Pilot Free Trade Zone. Further open timetables and roadmaps will be announced for service sectors such as finance, new energy vehicles and gas stations.
American companies have expressed interest in many industries in China, such as new energy. In this strategic emerging industry in China, the United States has always been said to be discriminated against. Tu Xinquan, dean of the China WTO Research Institute of the University of International Business and Economics and foreign trade expert of the Economic and Trade Policy Advisory Committee of the Ministry of Commerce, told the Caijing reporter: "Can we make a more transparent policy? American companies complain about the reasons for complaints. We may not have acknowledged it ourselves, or we have not found out these problems. Now we should take it seriously and solve the problem of multinational companies’ complaints."
In the interview with Caijing reporter, Long Yongtu, the chief representative of China’s WTO accession negotiations, who witnessed China’s entry into the WTO, also called for a trade dispute or a trade deficit. The best way is for China to show A more open attitude. "If we turn some of the pressure on China in this Sino-US or international economic and trade relationship into reform or accelerate the reform, it may become a good thing. All departments gradually implement and prove us with practical actions. The Chinese market is gradually opening up."
This article was first published on the WeChat public account: Financial magazine. The content of the article belongs to the author's personal opinion and does not represent the position of Hexun.com. Investors should act accordingly, at their own risk.
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