China seen in no hurry to end trade war with U.S.
China must uphold “the spirit of struggle” in defending national interests in its current trade war with the US, China’s Commerce Minister Zhong Shang, who recently joined the negotiations, said in an interview published Monday with People’s Daily, the Communist Party’s mouthpiece.
Market Watch cites the commerce minister in its article China seen in no hurry to end trade war with U.S. after comments by Commerce Minister: “The US has started this economic and trade dispute with us in violation of the principles of the World Trade Organisation – a classic example of unilateralism and protectionism. “We must make the best of the spirit of struggle, and stand firm in defending the interests of our country and the people, as well as the multilateral trading system.”
The remarks by Zhong came days after he joined a phone call with US Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin, the first time that he has been part of a direct conversation with Washington’s negotiators.
Zhong’s involvement, observers said, showed Beijing’s decision to enlist more trade experts as the talks get tougher, according to reports by the Washington Post and the Hong Kong based South China Morning Post.
Zhong, who worked under China’s President Xi Jinping during his time in Zhejiang province, has been minister of commerce since 2017, but he was not directly included in the negotiating team for more than a year into the trade war which began last July when U.S. President Trump issued a first round of tariffs on US$34 billion worth of goods imported from China.
Zhang Lifan, a Beijing-based commentator, said that Zhong’s comments indicated China was preparing for a protracted trade war with the US.
“The remark is mostly intended for a domestic audience but it clearly shows China is in no hurry to reach a deal and ready for protracted talks,” said Zhang.
“It looks like China is waiting to see what happens after the 2020 election.”
Scott Kennedy, an economist with Washington-based think tank the Centre for Strategic and International Studies, said Zhong’s greater prominence meant China had lost interest in addressing US concerns in the talks.
“Zhong Shan’s more visible involvement in the negotiations is one of many signs that China has lost interest in a major deal that addresses the concerns of the United States and other countries about Chinese industrial policy and the lack of market reciprocity,” he said.
“Those hoping for a deal that stabilizes the relationship should give up such illusions. It won’t be coming any time soon.”
Commer Minister Zhong’s remarks were made as officials from the two nations prepared for further talks. US Treasury Secretary Steven Mnuchin said that he and US Trade Representative Robert Lighthizer may travel to Beijing for trade negotiations if talks by telephone this week are productive.
“We expect to have another principal-level call this week, and to the extent we make significant progress, I think there’s a good chance we’ll go there later,” Mnuchin said on Monday at a briefing for reporters at the White House.
The planned phone call would be the second time the countries’ top trade negotiators have spoken since US President Donald Trump and Chinese counterpart Xi Jinping called a truce in their year-long trade war at a meeting during the Group of 20 summit at the end of June. The leaders agreed to restart talks about a trade deal, which had collapsed in May, but they gave no concrete time frame to reach a deal.
The US expects China to announce significant purchases of American agriculture products, Trump’s top economic adviser Larry Kudlow told reporters on Monday, implying that the step is necessary for the trade talks to advance.
“We expect China to be announcing shortly some large-scale purchases of farm goods and services,” Kudlow said.
Trump has been hoping that China’s economic slowdown will put pressure on Xi to cut a deal to end the trade war.
Official statistics published Monday showed that growth in the world’s second-largest economy has decelerated to the slowest rate in 27 years, partly because of the trade war.
The annual growth rate slowed to 6.2 percent in the three months to the end of June, down from 6.4 percent the previous quarter, the National Bureau of Statistics said. This is within the 6 to 6.5 percent band the government has set for this year and was in line with market expectations of a gradual slowdown, but it is still China’s lowest growth rate since records began in March 1992.
China’s export figures were particularly bad. Exports to the United States fell by 8.2 percent in the latest three months, with the bulk of the drop coming after tariffs on $200 billion worth of Chinese exports rose from 10 percent to 25 percent in May.
Trump seized on the data as a sign that his tariffs were making “thousands of companies” leave China for other countries. “This is why China wants to make a deal.... with the U.S., and wishes it had not broken the original deal in the first place,” the president wrote Monday on Twitter. “In the meantime, we are receiving Billions of Dollars in Tariffs from China, with possibly much more to come.”
But China’s Foreign Ministry also tried to counter a recent tweet by President Trump by stressing Tuesday it was misleading to suggest Beijing needed a trade deal with the US because its economy was slowing, Reuters reported.