Trump Puts the Screws to China, Wins Trade Concessions
So much winning.
President Trump met last weekend with Chinese President Xi Jinping. He's been talking tough about China's abusive trade policy, and reports say he put the screws to Xi.
The result? China plans to offer the Trump administration better market access for financial sector investments. What's more, China will also open up access to U.S. beef exports in order to avert a trade war, the Financial Times reported on Sunday.
Trump said throughout the campaign that China was a chief source of unfair trade practices, which has led to a $300 billion trade deficit. China says it's doing the U.S. a big favor by providing cheap goods to consumers, but Trump argues that the U.S. does not have the same access to their 1-billion-plus population.
Under terms of the agreement, the two sides set up a 100-day plan to hash out the details in trade talks.
"If we don't get some tangible results within the first 100 days, I think we'll have to examine whether it's worthwhile continuing them," Secretary of Commerce Wilbur Ross said on Fox News.
Both Trump and Xi trumpeted their meeting. Trump said the first get-together was the beginning of an "outstanding" relationship, and that "goodwill and friendship were formed, but only time will tell on trade." Said Xi: "We have a thousand reasons to get China-U.S. relations right, and not one reason to spoil the China-US relationship."
Said the Times:
Mr Trump’s campaign threats last year to slap tariffs on Chinese goods and declare Beijing a currency manipulator have raised fears of a destructive trade war between the world’s two largest economies. But since taking office the former reality television star has moderated his rhetoric and cabinet officials have signalled they plan to take a more pragmatic approach.
If concluded, the mooted deal would be welcomed by US financial services companies, which have grown increasingly frustrated in recent years about what they say are rising barriers to doing business in the country. Beef exporters have also complained about the lingering Chinese ban on US imports, which was introduced after a BSE scare in the US herd.
While a comprehensive Sino-US investment treaty remains a distant prospect, both sides are hoping to achieve a number of smaller trade deals in the coming three months. On Saturday, Mr Trump tweeted that Mr Xi’s two-day visit to his resort at Mar-a-Lago had been “tremendous”, before adding a warning shot.
“Goodwill and friendship was formed,” the US president said in a follow-up tweet. “But only time will tell on trade.” US officials are pressing their Chinese counterparts to lower their current 25 per cent tariff on automotive imports. Beijing in return would like greater protection for Chinese investment in the US, which tripled last year to more than $45bn, and also for Washington to relax restrictions on the sale of certain high-tech products to China. The Chinese government may simply commit to buy more US imports in the same way that Japan did in the 1980s.