U.S. and Chinese negotiators are scheduled to begin a 13th round of talks Thursday aimed at ending a 15-month trade war that is worrying global investors and weighing on the world economy.
Chinese Vice Premier Liu He will lead a delegation into meetings in Washington with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.
The world’s two biggest economies are deadlocked over U.S. allegations that China steals technology and pressures foreign companies to hand over trade secrets as part of a sharp-elbowed drive to become a world leader in advanced industries such as robotics and self-driving cars.
Under President Donald Trump, the United States has slapped tariffs on more than $360 billion worth of Chinese imports and is planning to hit another $160 billion Dec. 15. That would extend to import taxes to virtually everything China ships to the United States. China has hit back by targeting about $120 billion in U.S. goods, focusing on farm products.
The high cost of the tariffs and uncertainty over when and how the trade war will end have taken an economic toll, especially on manufacturing companies. A private survey last week found that U.S. factory output had dropped to its lowest level since 2009, when the economy was in the grips of a deep recession.
Expectations for this week’s talks are low. Beijing has been reluctant to make the kind of substantive policy reforms that would satisfy Washington. Doing so likely would require scaling back the Chinese leaders’ aspirations to technological dominance they see as crucial to their country’s future prosperity.
“I’m driving a tough bargain, but I have to,” Trump told reporters at the White House Wednesday.
US Commerce Secretary Ross Praises Australia, Criticizes China
U.S. Secretary of Commerce Wilbur Ross slammed China’s trade practices and trumpeted America’s economic relationship with Australia amid the festering trade war with Beijing.
Ross told a business gathering in Sydney on Thursday that President Donald Trump did not want to use tariffs to get China to change its ways but felt it was necessary.
The comments came as U.S. and Chinese officials prepared to resume trade talks in Washington later in the day.
U.S. President Donald Trump’s decision last year to implement tariffs against Chinese goods has shaken world markets and added to uncertainty over the global economic outlook.
“We do not love tariffs, in fact we would prefer not to use them, but after years of discussions and no action, tariffs are finally forcing China to pay attention to our concerns,” Ross said.
“We could have had a deal two-and-a-half years ago without going through the whole tit-for-tat on tariffs that we have,” he added.
Ross said the U.S. believes China needs to mend its ways. “China has refused to change its behavior,” he said. “In fact, its global trade practices have only gotten worse.
“If we can get China to abide by the global rules of trade, every nation in the world will benefit,” he said.
Resource-rich Australia relies on China for one-third of its export earnings. But Ross told the business leaders America is Australia’s “most important” economic partner.
“China may import more from Australia than the United States does, but their value-add to the Australian economy — and to the lives of Australians — is shockingly limited,” he said.
The U.S. accounts for 27% of foreign investment in Australia, and American companies employ more than 400,000 Australians, he said.
China, by contrast, represents less than 2% of foreign investment in Australia.
“So, I think it’s easy to blow out of proportion who has the more significant relationship with Australia,” he said.
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