Wednesday, 19 December, 2018

China vows quick trade moves as USA sends mixed signals

A woman walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong Wednesday Dec. 5 2018. Shares were moderatel A woman walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong Wednesday Dec. 5 2018. Shares were moderatel
Melinda Barton | 06 December, 2018, 16:35

China's foreign ministry, the only government department that holds a daily briefing that foreign media can attend, has repeatedly referred questions on details to the commerce ministry, which has yet to say anything.

Amid a series of morning tweets that seemed to contradict his administration's claims about a supposed trade deal between the USA and China, President Donald Trump declared himself to be "Tariff Man". "Unless extended, they will end 90 days from the date of our wonderful and very warm dinner with President Xi in Argentina", Mr Trump said on Twitter.

The White House on Monday had to correct a statement by economic adviser Larry Kudlow, who incorrectly told reporters in a conference call that the 90-day negotiating period between the USA and China would begin on January 1 instead of December 1. "But if not remember, I am a Tariff Man".

Trump again claimed Tuesday that more tariffs on China would actually help the U.S. He contended that he has made China "pay for the privilege" of raiding "the great wealth of our Nation".

Commerce Secretary Wilbur Ross, U.S. Trade Representative Robert Lighthizer, chief economic adviser Larry Kudlow and other administration officials were meeting individually with executives from each of the three automakers.

While at the conclusion of Saturday's working dinner, both the US and Chinese delegations said that what amounted to a trade war "truce" between the leaders had been reached, the messaging from the White House that followed seemed to only muddy the waters. Besides escalating existing tariffs, Trump had threatened to impose import taxes on the remaining US$267 billion of U.S. goods from China.

In Buenos Aires, Trump agreed to delay the scheduled US tariff increase for 90 days while the two sides negotiate over the administration's complaints related to how Beijing systematically steals trade secrets and forces the USA and other foreign countries to hand over sensitive technology as the price of admission to the vast Chinese market.

White House officials acknowledged that China hasn't fully committed to eliminate auto tariffs, as Mr. Trump announced Sunday in a tweet.

Trump, via Twitter, held out the possibility of an extension of the ceasefire but warned tariffs would be back on the table if the talks failed to bear fruit.

Mr Trump has long accused China of unfair trade practices that hurt U.S. citizens and the economy.

Instead, the two sides are to negotiate over U.S. complaints about China's trade practices, notably that it has used predatory tactics to try to achieve supremacy in technology.

Officials from the US and a number of other major economies have often criticized China for its slow approach to negotiations and not following through on commitments.

The tone of Trump's latest tweets show an apparent shift from 24 hours earlier, when he was unreservedly triumphant, saying relations with China had taken a "BIG leap forward". "Ultimately, I believe, we will be making a deal - either now or into the future", Trump wrote in a post within minutes of the Commerce Ministry statement.

Trump has exaggerated the effect of the tariffs on US revenue. Chinese shares responded in kind, opening lower on Wednesday.

China has said comparatively little about the Trump-Xi agreement after senior Chinese officials briefed the media following the meeting, and there have been some differences between USA and Chinese accounts of what the deal entails.

Chinese officials have been told to take necessary steps for the soybeans and liquefied natural gas purchases, according to two officials with knowledge of the discussions.

"Common to all these adjustments in the year ahead is a general tactical approach that until such time as China is able to finally bed down the fundamentals of its trade, investment, and economic relationship with the United States, it is wise for China to reduce tensions between Beijing and other countries and regions of the world", Rudd said.