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China secures core interests in trade talks

(Global Times)    07:50, May 22, 2018

Promise to increase imports from US not a concession

Though details of a trade truce between China and the US remain murky, early signs suggest that the Chinese delegation led by Vice Premier Liu He had secured China's core interests in trade negotiations with US officials, while averting a brewing trade war, Chinese analysts said.

US Treasury Secretary Steve Mnuchin on Sunday confirmed that China and the US have agreed on a framework to put the trade war "on hold." Liu had told Chinese media on Saturday that the two sides agreed to avoid a trade war and suspend tariffs on each other's goods.

The agreement, a turning point in escalating trade tensions between the world's two largest economies, came after the two sides reached a consensus on a number of issues, including China's promise to increase imports of US goods and services to reduce the US' trade deficit with China - something which, some argued, represents China's concession to US pressure.

But Mei Xinyu, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, a think tank affiliated with the Chinese commerce ministry, said such suggestions are "absurd."

"We had already planned to purchase the things we agreed to buy from the US. China said a long time ago that it would expand its imports," Mei told the Global Times on Monday. "So, basically, the US went through all the trouble, including threatening a trade war, to bring us back to where we were before."

In a joint statement on Saturday, Chinese and US officials said that both sides agreed on "meaningful" increases in US agricultural and energy exports, but stopped short of putting a specific number on the increases - something US officials had reportedly pursued ahead of negotiations in Washington. The US was reportedly asking China to reduce $200 billion from the US trade deficit by 2020.

Pointing to deals signed between China and the US during the visit of US President Donald Trump in November, Mei said expanding agricultural and energy imports from the US had already been agreed upon long ago. "About $160 billion of $250 billion in deals signed last year involves US energy products," he said.

Top Chinese officials have long stated plans to expand imports of quality goods and services. In a speech at the Boao Forum for Asia in March, Chinese President Xi Jinping said that "we will take the initiative to expand imports" of products that are competitive and needed by Chinese consumers, the Xinhua News Agency reported.

Protecting core interests

Liu said Saturday that China is willing to buy goods and services not only from the US but from the rest of the world as well, as long as the goods and services are competitive.

And there is "no problem" if China buys more products from the US if doing so can prevent a trade war and China can focus on its long-term goals, said Jiang Yong, a research fellow at the China Institutes of Contemporary International Relations in Beijing.

"China is playing the long game and trying to focus on upgrading its manufacturing industry, while the US is seeking short-term gains. Judging from the results of this round of negotiations, China protected its core interests," Jiang told the Global Times.

The Trump administration had reportedly sought to undermine China's "Made in China 2025" program because it considers the policy aimed at upgrading Chinese manufacturing a threat to its dominance in the sector.

"Protecting China's core interests, including its right to develop and upgrade its industry is a bottom line for China that the country would never give up," Jiang said. 

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

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