'NOT REALISTIC' Trump sends top team to AVERT looming US trade war with China
This week US Trade Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer will meet with Liu He, economic adviser to China President Xi Jinping to discuss how a trade war between the world’s two biggest economies can be avoided.
In response China put a 25 percent levy on US imports, such as soybeans, cars and whiskey.
With US and China now heading to the negotiating table Mr Trump said: “I think we’ve got a very good chance of making a deal.”
But analysts have warned averting a trade war may not be easy.
Derek Scissors, a resident scholar at the American Enterprise Institute, a Washington-based think tank, said the best the US can hope for is a “short-term bargain” that could include Beijing pledging to increase US imports.
Michael Camunez, CEO of consultancy Monarch Global Strategies and a former senior trade official under President Barack Obama said: “I don’t expect any grand bargains being struck. There is no clear strategy that can be discerned.”
China has warned the issue will not resolved by one meeting but hopes for constructive talks.
Hua Chunying, a spokeswoman for the Foreign Ministry, said: “It’s not realistic to expect to have all issues resolved through one consultation.”
“As long as the US maintains its sincerity in preserving the overall stability of bilateral trade ties, and adopts an attitude of mutual respect, equal consultations and win-win cooperation, we believe our consultations are going to be constructive.”
Ideally, Mr Trump wants China to buy more US exports with the aim of reducing the US $375 billion deficit in goods with the eastern giant. He also hopes to pressurise Beijing to move away from an industrial policy that has been accused of subsidising Chinese companies on the global stage.
Pauline Loong, head of Hong Kong research firm Asia Analytica, said there are not a lot of “big ticket” items China needs from the US and Beijing could instead offer the possibility of greater access for foreign companies.
President Jinping last month said his country will do more to open up its economy to foreign companies, but Mr Trump warned this was “not enough”.
Ms Loong said: “Beijing happily offers good intent. But what it has always been reluctant to offer is specifics.”
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