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Premier calls on US to be rational about tariffs, trade

(Global Times)    11:10, March 21, 2018

Premier Li Keqiang holds a press conference, taking questions from domestic and overseas journalists in Beijing, Mar. 20, 2018. [Photo: Xinhua]

Chinese Premier Li Keqiang on Tuesday called on the US to stay rational rather than being led by emotions in imposing tariffs, and vowed to open the Chinese market wider to deal with the trade imbalance.

There will be no winners in a trade war should one happen between China and the US, Premier Li said at a press conference after the conclusion of the annual legislative session.

A trade "war" would go against the principles of trade - negotiations, consultations and dialogue, according to Li.

Last year, China-US trade reached about $580 billion. Such a substantial trade could not have been achieved without business rules and market principles, he said.

"A large trade deficit is not something we want to see," said Li. "What we want is balanced trade, otherwise bilateral trade would not be sustainable."

China is going to further open services and manufacturing, which Li believes will create opportunities for US companies.

Li said he hopes that the US will also ease its restrictions on the export of high-tech and high value-added goods to China.

"Although China continually suggests that the US do so, it's unlikely to see positive change, because the trade issue in the US has been politicized by protectionism," said Diao Daming, an associate professor at the Renmin University of China.

China wants to solve the problem of imbalanced trade through "make the cake bigger" and structural reforms, but Trump does not have patience, because he desperately wants to see tangible change before this year's mid-term elections, which is totally unrealistic, so the trade frictions will continue after the mid-term elections, An Gang, a senior research fellow at the Pangoal Institution, a Beijing-based think tank, told the Global Times.

Two-way street

The premier also vowed that China will open even wider to the rest of the world, stressing that opening up is a two-way street.

The Chinese economy is so integrated into the global economy that closing the door would only block China's own way, Li said.

"China's opening-up is an active and voluntary move rather than a reaction to foreign pressure," said Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation in Beijing.

China's capabilities on managing foreign investment and competing with foreign firms are totally different from 40 years ago, so China is becoming more confident to open its market to the world, Bai said.

"Through opening-up, China can enjoy better resource allocation and also push its economic reforms to adapt to the international market," Bai added.

China will gradually relax and even scrap foreign-owned equity limits in some sectors and shorten the negative list for foreign investment, Li said.

China's negative list has shortened in recent years, and the pilot free trade zones, which are covered by the negative list policy, have increased from Shanghai to 11 zones across China. So in the future, the negative list policy would be further promoted in the country and become a standard policy in China, Bai noted.

"We are aiming to make the vast Chinese market a fair place for both domestic and overseas firms with all kinds of ownership to offer more options for 1.3 billion Chinese consumers," Li said.

Li said China still has much room to further open up its market and will lower overall tariffs on imports.

Tariffs on popular consumer goods, including drugs, will be slashed, while tariffs will not be imposed on much-needed drugs to cure cancer, he noted.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Kou Jie, Bianji)

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