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US-China trade negotiations enter tense new phase

Deputy trade negotiators from the United States and China have launched a new round of talks aimed at resolving the two countries’ 15-month trade war, with neither side showing any signs of giving ground.

About 30 Chinese officials led by Vice-Minister of Finance Liao Min entered the US Trade Representative’s office on Monday morning for two days of negotiations, to be followed by the first minister-level trade talks in more than two months.

The White House officially confirmed that the high-level talks, involving Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin, would begin on Thursday.

“The two sides will look to build on the deputy-level talks of the past weeks. Topics of discussion will include forced technology transfer, intellectual property rights, services, non-tariff barriers, agriculture and enforcement,” White House spokeswoman Stephanie Grisham said in a statement.

The talks are getting under way about a week before a scheduled increase -from 25 percent to 30 percent – in US tariffs on $250bn worth of Chinese goods.

US President Donald Trump has said the tariff increase will take effect if no progress is made in the negotiations.

The two sides have been at loggerheads over US demands that China improve protections of US intellectual property, end cybertheft and the forced transfer of technology to Chinese firms, curb industrial subsidies and increase US companies’ access to largely-closed Chinese markets.

Impeachment, Hong Kong and soya beans

As Monday’s talks got under way, the US Department of Agriculture reported more soya bean exports to China, the latest in a recent flurry of buying by Beijing.

China has booked deals for about 3.5 million tonnes of US soya beans since early September, about 10 percent of its annual purchases prior to the trade war.

In recent weeks, the US-China trade situation has become more complicated due to an impeachment inquiry by US Democrats, who are probing a request by US President Donald Trump that Ukraine investigate business dealings by the son of Democratic presidential candidate Joe Biden.

Trump also publicly asked China last week to investigate the Bidens.

White House trade adviser Peter Navarro said on Monday that neither the impeachment inquiry nor Trump’s request that Beijing investigate his political rival would weaken the US negotiating position.

Navarro told National Public Radio that Trump wants a big deal with China – or no deal at all.

Another complicating factor is US support for pro-democracy protests in Hong Kong. Trump has explicitly linked the trade talks to Beijing’s handling of the Hong Kong protests and preservation of the territory’s rights.

A new US-China flashpoint ignited on Monday over a tweet in support of Hong Kong protesters by an official of the National Basketball Association’s Houston Rockets.

China’s state broadcaster dropped the team’s games, and a Chinese corporate sponsor withdrew after Rockets General Manager Daryl Morey tweeted, “Fight for Freedom, Stand with Hong Kong”.

He swiftly deleted the tweet and apologised to fans in China, where the Rockets have a large following from the years when Chinese basketball star Yao Ming played on the team.

Source: Aljazeera

Dated on: 8/10/2019

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Pakistan gives kudos to China for building top Infrastructure while US wages futile war in Afghanistan

A key partner in Beijing’s Belt & Road Initiative has applauded China for building world class infrastructure while accusing the United States of squandering billions on the war in Afghanistan.

In New York for the United Nations General Assembly, Pakistani Prime Minister Imran Khan made the assessment during an interview with US broadcaster.

“While the USA was pouring money in Afghanistan in this futile war, the Chinese were developing first-world infrastructure and you just have to go to China to see where the infrastructure is,” Khan said when asked what advice he would give US President Donald Trump about the conflict in Afghanistan.

Earlier this month, Trump cancelled planned secret talks with the Taliban and Afghan President Ashraf Ghani.

“You knew this was going to be a war that would not achieve any results,” he said. “If I was an American I would ask, US$1.5 trillion at least has been spent on Afghanistan, what have we achieved in this? That money was wasted.”

Pakistan is home to the flagship project under the Belt & Road banner, the US$62 billion China-Pakistan Economic Corridor.

The corridor consists of a number of ports, airports, and power plants, as well as road, railways and pipelines to connect China’s far western region of Xinjiang to Pakistan’s Gwadar port on the Arabian Sea, right outside the exit of the Persian Gulf and the world’s most important oil route.

The former Cricket Superstar is not as enthusiastic about the initiative as his predecessor Nawaz Sharif or Beijing, and has slightly backed away and scaled down some of the projects since he took office last year.

But work on the economic corridor has continued despite debt concerns, local resistance and some security incidents.

Khan visited China a few months after being sworn in and reaffirmed the “all-weather” friendship in Beijing. The ties were underlined again as tension escalated with India this year over disputes in Kashmir.

Source: Belt and Road News Network 

Dated on: 30/9/2019

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How US will benefit by Cooperating with Belt & Road

China is emerging as a growing power and its rise is not limited to a certain domain. Rather, it is experiencing growth in economy, trade, political influence, soft and hard power. Above all, China’s commitment is to sustainable growth and mutual development across the world.

At present, China is engaged with around half of the countries of the world. It has built these bilateral and multilateral relations gradually.

It is incorrect to portray China’s increasing dominance as a bid to strategically encircle any country. China’s engagements with each country in the Belt and Road Initiative (BRI) abides by the established norms of international relations.

Whether it is Pakistan (a time tested friend of China) or any neutral State, China has focused on mutual partnerships and mutual growth.

At present, the worth of the BRI stands at US$1.2- 1.3 trillion. The BRI has converged the stakes of many countries of the world, which shows that China enjoys an edge, considering the volume of its economic input into these projects.

What does all this mean for Chinese competitors?

In finding an answer to this question, one first needs to consider who is or who are Chinese competitors?

Consider, Russia, India, and the European Union: None of these countries or entities is the loser by China’s rise, rather they are reliable partners in growth with China. The only country which might lose strategic or economic advantage is the United States.

The US and China are engaged in a trade war and have political discords. America has openly expressed reservations about the BRI as America believes it might hurt its strategic objectives.

The BRI is focused on connecting China and Europe via land and sea, with the sea link passing through the South China Sea as well. China aims at focusing on developing infrastructure along the Indian Ocean, the Red Sea and the Mediterranean. These three seas hold significant strategic importance for China as well as the US. The too clash here.

However, Congressional hearings about the BRI and Security and Economic review of US-China relations, have not been held in the recent past, despite Congressional concerns over monitoring developments in US-China relations. This shows that the US, to a minimal extent, considers the developments benefiting its agenda of cooperative development.

The US has ignored China’s mega plans of development, as it believes that the BRI can offer opportunities to American allies if not the America itself.

Despite having reservations about China’s trade initiatives, bilateral trade between the US and China stands at billions of dollars. When it comes to competing in building critical infrastructure, rails and roadways, the US is lagging behind. This is where the US can benefit from Chinese experience. China has shown willingness to share its experience with the US in this field.

With President Trump’s arrival, bilateral competition has become more stringent; coupled with the ongoing trade war things have gotten worse. They have ended the leverages which they had been offering to each other for decades.

President Trump’s vision of ‘America First’ has taken the US far from China. But Trump’s isolationist strategy has not proved to be prudent in financing and executing America’s projects. The history of China suggests that its development was based initially on isolationism. But it has benefited from it and also come out of it. This is also an area in which Chinese experience can benefit America.

Considering such developments, the Atlantic Council strategy paper about ‘Silk Road and US strategy’ says that the US should reconsider its approach toward China, since, confronting China is becoming counterproductive.

The paper also highlights many areas where the United States can be a beneficiary of Chinese development; specially by expanding bilateral economic relations and use China’s influence over South Asian politics, where America is confronting challenges.

American experts believe that while posing a tough challenge to China, America must focus on converging its efforts with China’s, to participate in Eurasian growth since it Eurasia is a strong export market for US products. The Chinese believe that a collaborative approach could serve the interests of both China and America in Europe.

But at present China want America to maintain a distance. This is because of the on-going trade war which it believes can disrupt the idea of cooperative development.

On the other hand, the Chinese idea of mutual development is considered flawed by Americans. But the Chinese believe that the US should benefit in terms of expanding inter-regional and extra-regional growth. The Chinese have always rejected the idea that the BRI means strategic encirclement of any specific country.

American experts who have long studied Chinese growth and development argue that the US must adopt the strategy of constructive development. They condemn the cherry-picking approach. They believe that the US can participate in energy-related projects, and asses the growth prospects of building new regional connections.

The cherry-picking formula might also conflict with the American geopolitical interests as well. America should not insist that every Chinese project must meet its ideological worldview and abjure projects which abridge its strategic interests.

Constructive participation needs complete manifestation of will and power to uplift bilateral partnerships.

The present century is witnessing immense growth and development. Each sector is witnessing new trends. But trade and economic interests have remained the classic reason for conflict. China and the US have a totally different history. One has a protectionist approach, while the other calls itself the champion of profuse development.

China’s growth is the new mechanism in place and the world is adjusting itself with the plans offered by China. Its soft and gradual growth is attracting the outer world, which has left the US with no other alternative but to witness the new trends.

In contrast to China’s economic developmental approach, the US spells nothing but conflict, destruction and diffidence. The Chinese model aims at building partnerships for mutual benefit and not conflict.

China is the only state in the present century placing in front of the world a creative and meaningful way for coming out of economic stagnation. The US cannot protect itself from the impact of BRI or China’s growth.

There is no dearth of International relations scholars who argue that the Chinese model deserves a look by the US.

Source: Belt and Road NEWS  

Dated on: 19/9/2019

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Sanders: China Has Made ‘More Progress’ on Extreme Poverty than Any Country in History

Presidential contender Bernie Sanders spoke highly about China’s leadership in a new interview, saying that the Chinese government has made great strides in combating extreme poverty despite moving in a more authoritarian direction.

“China is a country that is moving unfortunately in a more authoritarian way in a number of directions,” the Vermont senator said in his interview with The Hill. “But what we have to say about China in fairness to China and its leadership is, if I’m not mistaken, they have made more progress in addressing extreme poverty than any country in the history of civilization, so they’ve done a lot of things for their people.”

Since the 1980s, the number of people living in extreme poverty in China has dropped dramatically. By 2015, the country’s “poverty headcount ratio,” the percentage of its citizens living on less than $1.90 a day, was at 0.7, according to the World Bank. But even so, by the end of 2017, 30.46 million rural people still lived below China’s poverty line, the National Bureau of Statistics reported.

Sanders also said that while he agrees that China looks out for its own interests first, he disagrees with calling the country an “existential threat” to the American worker, as some have warned.

“Their economy now is struggling but I think it is absolutely possible for us to have a positive working relationship with China,” Sanders said.

China and the U.S. have escalated their war of reciprocal tariffs over the past year, as President Trump continues to demand that Beijing change what he says are unfair trade practices, such as stealing intellectual property and manipulating the country’s currency.

China announced Friday that it will retaliate against the Trump administration’s latest tariffs with duties on $75 billion worth of U.S. goods. Tariffs of between 5 and 10 percent will be imposed on September 1 and December 15, the same dates the U.S. plans to slap a 10 percent tariff on the $300 billion worth of Chinese exports it has not yet taxed.

Over the weekend, Sanders said that as president he would be open to using tariffs to provide leverage in negotiations with the world’s second-largest economy.

“If it is used in a rational way within the context of a broad, sensible trade policy, it is one tool that’s available,” Sanders told CNN. “We need a rational trade policy today, not what Trump is doing by tweet.

Source: Yahoo News

Date: August 27, 2019

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U.S. Pushes China on Promises After ‘In-Depth’ Trade Meetings

Source: Bloomberg

Date: 9th January 2019

The Trump administration is pushing for a way to make sure China delivers on its commitments in any deal the two nations reach to defuse a trade war that has roiled financial markets and dimmed the outlook for global growth.

The U.S. wrapped up three days of mid-level talks with China in Beijing on Wednesday, noting a commitment by President Xi Jinping’s government to buy more U.S. agricultural goods, energy and manufactured products. For its part, China said the meetings were “extensive, in-depth and detailed,” and laid the foundation for a resolution of the conflict.

The office of U.S. Trade Representative Robert Lighthizer said it wants any deal to include “ongoing verification and effective enforcement” and the U.S. will decide on next steps after officials report back to Washington.

 China’s Ministry of Commerce on Thursday said the two sides “implemented the consensus” reached by the two presidents in earlier talks, and discussed both trade and structural issues in the meetings.

Investors welcomed signs of optimism from the talks. Stocks rose globally after the two economic powers appeared to inch closer to an agreement, with the S&P 500 Index rising for a fourth day to the highest in almost a month.

The U.S. push for enforceable targets in a deal underscores the challenge of reaching a lasting truce. President Donald Trump and his deputies have criticized China for failing to live up to past promises, including a pledge to promptly open up the Asian nation’s economy to more trade and investment after it joined the World Trade Organization in 2001.

Trump and Xi have given their officials until March 1 to reach an accord on “structural changes” to China’s economy on issues such as the forced transfer of American technology, intellectual-property rights, and non-tariff barriers. It’s a tight window in which to nail down deep changes to China’s economic model, some of which past U.S. administrations advocated for years and U.S. lawmakers on both sides of the aisle support.

A group representing American companies doing business in China welcomed the “substantive discussions,” but stressed the need to work out key details. “Progress should include a mechanism for the removal of tariffs and measurable, commercially meaningful outcomes,” the U.S.-China Business Council said in a statement. The U.S. and China have slapped a tariffs on a combined $360 billion in each other’s imports since July.

The USTR statement didn’t say whether progress had been achieved on its main concerns.

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China rejects NYT report about building military equipment under CPEC

Source: The News

Date: 21 December 2018

BEIJING: The Chinese foreign ministry Friday rejected a media report that it was planning to build military equipment including fighter jets under China-Pakistan Economic Corridor (CPEC) framework.

“According to our information, the relevant report is not true,” Chinese foreign ministry’s spokesperson Hua Chunying said during her regular briefing held here.

She remarked that the CPEC was an important framework for cooperation bearing long-term interests for both sides.

The New York Times reported Thursday in a long dispatch claiming that Beijing’s “Belt and Road” plan was taking a “military turn” as Pakistani Air Force and Chinese officials are putting the final touches on a plan to expand Pakistan’s building of Chinese fighter jets, weaponry and other hardware.

The dispatch said that the newspaper had “reviewed” the confidential plan which it says also envisages the cooperation between China and Pakistan in space.

“All those military projects were designated as part of China’s Belt and Road Initiative, a $1 trillion chain of infrastructure development programmes stretching across some 70 countries, built and financed by Beijing,” NYT’s correspondent Maria Abi-Habib wrote from Islamabad.

– Joint Coordination Committee meeting –

Referring to the meeting of Joint Coordination Committee (JCC) on CPEC held on December 20 in Beijing, the FO spokesperson observed that the two sides would continue to implement the consensus reached between the leadership of the two countries to cement the early harvest projects and to extend the CPEC to industrial parks and social livelihood.

To a question regarding reports of withdrawal of the US troops from Afghanistan and Syria, she said that China’s position on these two issues was consistent.

Hua Chunying said that as the close neighbour of Afghanistan, China stood for the Afghan-led and Afghan-owned inclusive reconciliation process.

“We are willing to make concerted efforts to achieve long-term peace and stability in Afghanistan helping the Afghan people to enjoy peace and stability at an early date.

To another question about Syrian issue, she said that the Chinese side always believed that sovereignty, independence and territorial integrity of Syria should be respected and the future of Syria should be determined by its own people.

The spokesperson said that China would like to work with the international community and continue to play a positive and constructive role in the early settlement of Syrian issue.

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One Belt, One Road, One Big Mistake

Source: Foreign Policy
Author: 
Date:  

The headlines coming out of this year’s APEC conference in Papua New Guinea focused on the conflict between America and China that kept the forum from issuing a joint communiqué. Less noticed were two short memorandums released on the sidelines of the conference by the island nations of Vanuatu and Tonga. In return for renegotiating existing debt, both agreed to become the newest participants—following other Pacific nations like Papua New Guinea and Fiji—in Chinese President Xi Jinping’s signature foreign-policy venture, the Belt and Road Initiative (BRI).

As Xi’s trillion-dollar development strategy has snaked away from the Eurasian heartland and into the South Pacific, western Africa, and Latin America, concern has grown. Many Americans fear that the Belt and Road Initiative is an extension of efforts by the Chinese Communist Party (CCP) to undermine the security and economic architecture of the international order. China’s growing largesse, they worry, comes largely at the expense of international institutions and American influence.

This angst lies behind another announcement made at last month’s APEC gathering: Australia, Japan, and the United States declared that they had formed their own trilateral investment initiative to help meet infrastructure needs in the Indo-Pacific. For some this is not enough: In its most recent report to the United States Congress, the bipartisan U.S.-China Economic and Security Review Commission recommended that Congress create an additional fund “to provide additional bilateral assistance for countries that are a target of or vulnerable to Chinese economic or diplomatic pressure.”

This is the wrong response to the Belt and Road Initiative. Ignore the hype: For the Chinese, this initiative has been a strategic blunder. By buying into the flawed idea that barrels of money are all that is needed to solve complex geopolitical problems, China has committed a colossal error. Xi’s dictatorship makes it almost impossible for the country to admit this mistake or abandon his pet project. The United States and its allies gain nothing from making China’s blunders their own.

In Xi’s speeches, the phrase most closely associated with the Belt and Road Initiative is “community of common destiny.” Xi’s use of this term is meant to link the BRI to the deeper purpose party leaders have articulated for the CCP over the last three decades. China’s leaders believe that not only is it their “historic mission” to bring about China’s “national rejuvenation” as the world’s most prestigious power, but that China has a unique role to play in the development of “political civilization” writ large.

It is the Chinese, Xi maintains (as Hu and Jiang did before him), who have adapted socialism to modern conditions, and in so doing have created a unique Chinese answer to “the problems facing mankind.” Though this answer began in China, Xi is clear that the time has come for “Chinese wisdom and a Chinese approach” to benefit those outside of China. The Belt and Road Initiative is intended to do just that. By using the Chinese model of socialism to develop the world’s poorer regions, the initiative justifies Xi’s grandiose claims about the party’s historic mission on the international stage.

To match these lofty aims, Chinese academics and policy analysts at prestigious party think tanks have articulated more down-to-earth goals for the initiative. According to them, the BRI promises to integrate China’s internal markets with those of its neighbours. Doing so will bring its neighbours closer to China geopolitically and bring stability to the region. By increasing economic activity in China’s border regions, such as Xinjiang and Tibet, the Belt and Road Initiative will lessen the appeal that separatist ideology might have to the residents. Another projected benefit is the energy security that will come through the construction of BRI-funded transport routes. Finally, by articulating and then following through on an initiative that puts common development over power politics, China will gain an advantage over other major countries (read: Japan and the United States) who present the world as a black-and-white competition for hegemony. The community of common destiny, these analysts have claimed, is a community that will immensely benefit China.

As the Belt and Road Initiative is only five years old (and many of its main members have been involved for a far shorter time) its full results cannot yet be judged. However, a preliminary assessment can be offered for BRI projects in South and Southeast Asia, the region described by Chinese leaders as the “main axis” of the Belt and Road Initiative. It is here that BRI investment is strongest and has been around longest. The picture is not promising. The hundreds of billions spent in these countries has not produced returns for investors, nor political returns for the party. Whether Chinese leaders actually seek a financial return from the Belt and Road Initiative has always been questionable—the sovereign debt of 27 BRI countries is regarded as “junk” by the three main ratings agencies, while another 14 have no rating at all.

Investment decisions often seem to be driven by geopolitical needs instead of sound financial sense. In South and Southeast Asia expensive port development is an excellent case study. A 2016 CSIS report judged that none of the Indian Ocean port projects funded through the BRI have much hope of financial success. They were likely prioritized for their geopolitical utility. Projects less clearly connected to China’s security needs have more difficulty getting off the ground: the research firm RWR Advisory Group notes that 270 BRI infrastructure projects in the region (or 32 per cent of the total value of the whole) have been put on hold because of problems with practicality or financial viability. There is a vast gap between what the Chinese have declared they will spend and what they have actually spent.

There is also a gap between how BRI projects are supposed to be chosen and how they actually have been selected. Xi and other party leaders have characterized BRI investment in Eurasia as following along defined “economic corridors” that would directly connect China to markets and peoples in other parts of the continent. By these means the party hopes to channel capital into areas where it will have the largest long-term benefit and will make cumulative infrastructure improvements possible.

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China threatens to hit back at US with tariffs on 106 more US products

BEIJING: Just hours after the Trump administration unveiled a list of $50 billion worth of Chinese goods on which the White House plans to impose 25 per cent tariffs, China hit back with its own list of 106 US products, including soybeans, corn, cars as well as aircrafts, that it would also target with tariffs of 25 per cent if the US does not back down.

The US’s list of 1,333 imports which ranges from aerospace equipment to industrial robots, satellites, semiconductor parts and machinery for everything from railways to biscuit ovens – specifically targets a key Chinese campaign to upgrade its economy called “Made in China 2025”.

That Made in China national plan, designed to turn China into a “manufacturing superpower” by investing in sectors such as IT, new energy vehicles, robotics and other forms of smart manufacturing, may be the real sticking point in a potential trade war between China and the US.

“Made in China 2025 is a must for China,” said an independent economist based in Shanghai. “Thus it will be China’s bottom line. We can negotiate, we can bargain on this, we can impose small punishments on each other but if the US touches on the foundation of Made in China 2025, there will definitely be a large trade war,” she said.

Beijing describes Made in China, first introduced by a Chinese think-tank in 2013 and adopted by the Chinese government in 2015, as an effort to avoid the middle-income trap that developing countries can fall into, and encourage home-grown innovation.

To achieve this, China wants to replace most of the foreign technology it imports with locally made components. China’s 2025 campaign is billed as a way to get the country on par with industrial heavyweights, alongside Germany, South Korea, Japan and the US.

The US and other critics do not see it in the same light. In the conclusion of the US trade office investigation into Chinese trade practices, which was the basis of president Trump’s initial announcement of the tariffs in March, the Made in China policy is mentioned numerous times.

China’s top-down approach to economic planning could also stand in the way. State support encourages companies and local officials to chase subsidies, eventually creating overcapacity, according to senior adviser and China practice lead at the Crumpton Group, Jude Blanchette. “Central planning often gets you a lot of waste,” he said. Still, he believes what can be achieved will have a critical impact. “Made in China 2025 is going to drastically change global value chains and how industries operate, if China gets half of the way, that’s going to have profound repercussions.”

Source: https://profit.pakistantoday.com.pk/2018/04/04/china-threatens-to-hit-back-at-us-with-tariffs-on-106-more-us-products/