Experts discuss recent Sino-US trade talks in Beijing
From May 3-4 in Beijing, Chinese Vice Premier Liu He met with top Trump administration economic officials led by Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross to discuss Sino-U.S. trade issues. The talks, followed by separate statements from either side, come amidst a period of increased tension in the bilateral relationship.
On May 7, CCG hosted a timely roundtable to assess the state of Sino-U.S. economic relations in the wake of the talks. Distinguished experts from government, academia, and think tanks offered views on recent developments and the future direction of Sino-U.S. trade talks, as well as putting forward constructive policy proposals for both sides.
The roundtable opened with comments from each of the discussants, beginning with He Ning, CCG Senior Fellow, former Minister for Trade and Economic Affairs at the Chinese Embassy to the U.S. He said that it was unrealistic to have expected much progress in the first round of such talks and that it is a good start that both sides could put key points on the table and establish a basis for further discussion. He emphasized two aspects to resolving the current trade frictions. Firstly, both sides should maintain a rational approach and avoid “emotionalizing” the negotiations. Secondly, it is important to remain patient, use multilateral mechanisms, and where possible transform the external pressure into impetus for deepening China’s domestic reform and development.
CCG Senior Fellow He Weiwen, former Economics and Commerce Counselor at the Chinese Consulate-General in New York and San Francisco, echoed the message that the recent meeting should only be seen as a prelude to the start of proper negotiations. He outlined several points to inform China’s appropriate stance moving forward: 1) adhere to WTO multilateral principles, 2) there is some room to negotiate on market access issues; 3) China should make thorough preparations, as the timelines stated by the US indicate that Washington intends to act when deadlines arrive; and 4) current Sino-US trade frictions are heavily influenced by US domestic politics, so to resolve the trade issue it is necessary to reduce political interference.
Jiang Shan, CCG Senior Fellow and former Director-General of MOFCOM’s Department of American and Oceanian Affairs, underlined the shared interests of China and the U.S. and said that maintaining bilateral cooperation is important not only for both countries, but also for the global economy. He noted that China’s growing middle class has become the largest consumer market for the U.S. and said that both countries stand to gain by working together to “enlarge the cake.”
Ni Feng, Deputy Director-General of the Institute of American Studies (IAS) at the Chinese Academy of Social Sciences (CASS). highlighted how economic relations - previously a ballast for stability in the Sino-US relationship - have become a source of contention, with the Trump administration attributing all kinds of problems to China’s economic impact. Jiang outlined several options for China to resolve the current dispute, including preparing robust countermeasures, constructive diplomacy with other countries, and continuing with China’s opening-up to ensure sustained economic development.
Given the transactional nature of Trump's presidency, Lü Xiang, Non-resident Senior Fellow of CCG and the CASS World Politics Research Center, underscored the importance of identifying exactly what Trump’s priorities are. He pointed out that Trump’s dual aims of a strong dollar and boosting US exports contradict economic theory, so he is pushing to get individual countries to reduce their exports to the US by way of negotiations. Lü raised several suggestions for China to deal with the current situation, including closely observing and understanding the behaviour of the Trump administration, forming a unified international front with partners such as the EU and Japan, increasing coordination with US interest groups, and making adequate preparations for a worst-case scenario.
Wang Yong, CCG Non-resident Senior Fellow and Peking University Professor of International Relations, shared his views on the outlook for future talks. Wang noted the strong influence of US domestic politics, in particular, the upcoming mid-term elections and bi-partisan hardening of attitudes towards China. At the same time, he noted that the big picture of Sino-U.S. economic relations has not changed significantly, and China and the U.S. remain closely linked as cooperative partners in global supply and value chains. While Wang expects forthcoming negotiations to be intense, he says that this close interdependence should help bring about a positive outcome.
Experts went on to an in-depth discussion on what China’s bottom line and strategy should be in future negotiations, before fielding questions on a range of topics from the almost 20 reporters in attendance.