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US-China trade war: ‘winner takes all’ means both sides lose, Beijing’s ambassador to Washington says

China and the United States should stop thinking in terms of win and lose, and not overstate the challenges facing them, Beijing’s top envoy to Washington said, as US officials prepare to travel to the Chinese capital for the latest round of trade negotiations next week.

Speaking at an event organised by the World Affairs Council of Western Michigan, Cui Tiankai, China’s ambassador to the US, said that “too much emphasis” had been put on competition and that the two sides should focus more on cooperation for mutual benefit.

Relations between the two countries and their companies would only suffer under the destructive nature of a “zero-sum” or “winner takes all” mindset, he said.

“The real story in business is not that black and white,” Xinhua quoted him as saying. “We need to develop even stronger relationships on the basis of coordination, cooperation and stability.”

China and the United States have been locked in a trade war since July that has seen them impose hefty tariffs on each other’s imports. Further punitive action is on the cards if a deal is not reached before the end of a truce agreed by Presidents Xi Jinping and Donald Trump in Buenos Aires in December in less than three weeks’ time.

Hopes for a resolution took a knock on Friday when Trump said he was unlikely to meet Xi before the March 1 deadline. Failure to reach a settlement could see the US increase the tariffs it imposed on US$200 billion worth of Chinese goods in September from 10 per cent to 25 per cent.

The White House said on Friday that US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to Beijing for top level negotiations on Thursday and Friday. The Chinese delegation will be headed by Vice-Premier Liu He.

The meetings will be preceded by vice-minister level talks starting on Monday, with the US team for those headed by deputy trade representative Jeffrey Gerrish.

The other members of the US delegation are: chief agricultural negotiator Gregg Doud, undersecretary for international affairs David Malpass, undersecretary for trade and foreign agricultural affairs Ted McKinney, undersecretary for commerce for international trade Gilbert Kaplan, deputy assistant to the president for international economic affairs Clete Willems, and assistant secretary for fossil energy Steven Winberg.

Chinese government advisers said there was still an opportunity for the two sides to make a breakthrough next week, but stressed that deep divisions remained on issues such as intellectual property protection, Beijing’s subsidies for state-owned enterprises and forced technology transfer.

The US has also been pushing for an enforcement mechanism for a potential deal.

Chin Leng Lim, a specialist in international trade law at the Chinese University of Hong Kong, said that in the absence of a meeting between Trump and Xi it was possible that the March 1 deadline could be pushed back, as although the negotiations were making progress, “finishing [them] on time is another thing”.

“First, China has to buy ‘enough’ from the US. Farm, energy, industrial products have all been targeted,” he said. “Second, what kinds of pledges and actions would count as ‘serious’ and ‘enforceable’ Chinese structural reform?”

Beijing had sought to tackle Washington’s concerns about forced technology transfers and intellectual property protection by liberalising the mainland investment market and proposing reforms of its foreign investment laws, Lim said.

“[The] law would then treat US and Chinese investments equally, in principle,” he said. “That may not answer every US concern for now, but that’s because there is not enough time to get into very detailed issues, including practical issues regarding enforcement.”
Source: South China Morning Post

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