US-China trade talks leave ‘much room for cooperation’ despite few details and no response from Washington

11/06/2021    15

While exact details surrounding the latest trade talks between China and the United States remain scarce, and Washington has not yet issued an official response, there are hopes in Beijing that a “more reasonable and rational” approach from the Biden administration could soon lead to a reduction in tariffs and a further easing of restrictions on Chinese companies.

Beijing confirmed that Commerce Minister Wang Wentao and his American counterpart, Gina Raimondo, held a “candid and pragmatic exchange of views” during talks on Thursday morning – the third such meeting in the span of two weeks, after about nine months of silence.

Thursday morning’s statement from China’s Commerce Ministry, as well as the subsequent follow-up in the afternoon’s regular weekly media briefing, failed to provide any clear details of the topics covered – much the same as the two statements that accompanied the meetings that Vice-Premier Liu He had with both US Trade Representative Katherine Tai and US Treasury Secretary Janet Yellen.

But with the talks occurring just hours after US President Joe Biden revoked executive orders by former president Donald Trump seeking to ban Chinese social-media apps TikTok and WeChat, the lack of details failed to dampen expectations.
Taiwan has long angled for a free trade deal with the United States, but trade and investment talks between the two have been stalled since the Obama administration.

“The phone call is likely an opportunity for both countries’ trade officials to get in touch, lay out our positions, and decide on the next steps,” said Wu Xinbo, director at the Centre for American Studies at Fudan University.

“The easing of the TikTok ban is a positive signal from the US. There is still much room for Sino-US cooperation on trade,” Wu added. “We can see that the Biden administration has so far shown that it is much more reasonable and rational than the Trump administration.

“We can discuss gradually cancelling the tariffs in the coming months. The Chinese side also expects that the US will adjust its entity list on Chinese companies.”

After Liu and Tai held a “candid and constructive” exchange on May 27, China’s vice-premier also had “candid” exchanges on issues of concern with Yellen on June 2.

The talks between Liu, China’s top trade negotiator, and Tai represented the first time top trade negotiators from China and the US had held talks since Biden entered the White House.

Wang Huiyao, president of the Centre for China and Globalisation, a Beijing think tank, said that the timing of the latest talks between the US and China sends a “very positive message”, having taken place shortly after Biden arrived in Britain ahead of the Group of 7 summit where China is expected to be on the agenda.

“[The Biden administration] also must consider the interests of American companies and the fundamentals of the US economic recovery, so it is unlikely to blindly suppress [China] … We need a larger scope [of contact],” Wang said.

He expected that the conversation between Beijing and Washington could further expand into the realms of technology, industry and education, pointing to the previous China-US Strategic Economic Dialogue, which more than a dozen ministers participated in.

Wang expected that more practical issues will appear on the agenda in the future, including tariffs and the possibility of face-to-face meetings, as relations improve.

“In particular, the unreasonable tariffs faced by China and the US require the two sides’ commerce authorities to come up with solutions as soon as possible,” he said, adding that trade and economic issues between the two countries “involve many aspects and departments, and expanding the communication coverage could make it easier to clarify some misunderstanding and to enhance consensus”.

“The two countries need more discussions [in areas of possible cooperation], more mechanisms and platforms to establish institutional dialogues, and more conversations in the fields of environment, trade and investment, which are all beneficial,” he said.

The latest talks followed the White House’s announcement on Tuesday that the Biden administration would establish a “supply chain trade strike force”, led by Tai, to stop the “hollowing out” of American industry and the erosion of critical supply chains for products such as semiconductors and medicines.

The measures were contained in a 255-page review released on the same day that the US Senate passed a sweeping US$250 billion bill to boost US competitiveness in the face of mounting geopolitical tensions with China.

“All countries have the responsibility to develop their own industries and to enhance the well-being of their people,” Commerce Ministry spokesman Gao Feng said at Thursday’s media briefing when asked about the US Innovation and Competition Act of 2021.

“We are happy to see economic development and technological progress in other countries, but we are opposed to linking one’s own development plans with the containment of other countries; to politicising economic and trade issues; and to engaging in zero-sum games, which are not in line with the theme of peaceful development of the times.”

The latest talks also took place hours before China passed an anti-sanctions law, which provides legal backing for Beijing’s measures to counter foreign sanctions.

“As the two largest economies in the world, the essence of economic and trade relations between China and the US is mutually beneficial and win-win,” said Gao, who refused to comment on the specific topics discussed during the talks.

“Both sides have their own pressing concerns in the economic and trade field, but on the basis of mutual respect and equal treatment, we can explore solutions through dialogue and consultation. The economic and trade teams of both sides are maintaining communication.”

Source: SCMP