China: Trade deals in jeopardy if United States tariffs are implemented

Fredrick Soto
June 6, 2018

Since then both the countries have been negotiating to reach an understanding. He called for tariffs on $50 billion of imports from China unless it addressed the issue of theft of American intellectual property.

The United States and China have threatened tit-for-tat tariffs on goods worth up to $150 billion each.

While it was not clear how many cargoes COFCO booked, one of the two sources briefed on the buying said COFCO and state grain stockpiler Sinograin have together bought at least 10 million tonnes of USA soybeans. The prevailing view in the military and intelligence establishment is that China's efforts to outstrip the USA in the high-tech sector constitutes a threat to the economic and military supremacy of the United States. "But we're also standing firm that the president is the leader on this".

The intransigence of the U.S. on this question was laid out in the broad demands presented to Beijing at the beginning of last month, which included the demand that China not "oppose, challenge, or otherwise retaliate against the United States' imposition of sanctions on investments from China in sensitive USA technology sectors or sectors critical to USA national security".

Earlier, China responded with a threat to retaliate with higher duties on a $50 billion list of American goods including soybeans, small aircraft, whiskey, electric vehicles and orange juice.

Ross, who was preceded in Beijing last week by more than 50 US officials, is expected during the two-day visit to try to secure long-term purchases of USA farm and energy commodities to help shrink the USA trade deficit.

The U.S. delegation at the Beijing talks included Under Secretary of Treasury for International Affairs David Malpass, Under Secretary of Agriculture for Trade and Foreign Agricultural Affairs Ted McKinney, and United States Trade Representative Chief Agricultural Negotiator Gregg Doud. He blames what he calls their abusive trade policies for America's persistent trade deficits - $566 billion previous year.

Kuijs of Oxford Economics said an extended conflict could lead to a "technological cold war" that would carve up the global market into isolated regions with different standards for mobile phones and other products.

China has threatened to hit back with tit-for-tat tariffs on tens of billions of dollars in United States goods. His hardline trade adviser, Peter Navarro, charged Wednesday that Mnuchin's conciliatory comments about China were "an unfortunate sound bite".

"China will carefully evaluate the USA measures and relevant impact and retain its rights to adopt relative measures".

China, it said, was willing to increase its quota of imports as it was part of the country's national strategy. That would amount to more than one-third of Chinese imports of American goods.

The U.S. team also wants to secure greater intellectual property protection and an end to Chinese subsidies that have contributed to overproduction of steel and aluminium.

On Friday, China's markets regulator said it was still reviewing San Diego-based Qualcomm Inc's $44 billion acquisition of NXP Semiconductors. The arrival of Ross and his team in Beijing had fostered optimism in China that the issue could be settled without any big moves by Beijing. "If the ban stays, Beijing's retaliation will definitely go up a gear". Before the establishment of the federal income tax in 1913, tariffs were a big money raiser for the USA government.

The tariffs announced Thursday on steel from Canada, Mexico and Europe have no effect on China.

"All economic and trade outcomes of the talks will not take effect if the U.S. side imposes any trade sanctions including raising tariffs", the statement said.

Allies together with Canada and the European Union are threatening retaliatory tariffs.

Canadian Prime Minister Justin Trudeau told NBC's Meet the Press on Sunday that the reciprocal tariffs would hurt both US and Canadian workers and consumers.

Bruno Le Maire, France's finance and financial system minister, additionally known as the USA tariffs unjustified.

Calling the U.S. tariffs on steel and aluminium "deeply deplorable", Japanese Finance Minister Taro Aso said, "I've been to these meetings for a long time".

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