On Aug. 1, the day after U.S. and Chinese trade officials met in Shanghai to restart talks, U.S. President Donald Trump said via Twitter that his administration would impose new tariffs on US$300 billion worth of Chinese goods.
The 10 percent tariff would not affect the 250 billion dollars of Chinese exports already subject to 25 percent tariffs, meaning that when they go into effect on Sept. 1, virtually all of goods from China would be taxed.
Trump cited poor results in negotiations as the reason for the move. Specific complaints included failure on the part of Chinese companies to buy more American agricultural goods, as well as a broken promise apparently made to Trump by Chinese president Xi Jinping that Beijing would curb the export of fentanyl, a deadly opioid, to the United States.
Sino-U.S. trade talks will continue in spite of the tariffs, Trump tweeted. Talking to reporters at the White House, the president said that tariffs would remain in place “until such time as there is a deal.”
He also stressed that tariffs on Chinese goods had caused many companies to shift production out of China and to other countries.
The Shanghai talks were the first time since early May that the United States and China have held face-to-face trade negotiations. This spring, the trade truce that had been in effect since Dec. 1 last year fell apart after 11 rounds of talks in Washington D.C. and Beijing ended. The Chinese had agreed to, then suddenly backtracked on important concessions, causing the impasse.
The Trump administration launched its trade war against China in spring 2018, placing initial tariffs on Beijing for its decades of unfair and illegitimate trade practices, including abuse of its WTO status as a “developing country,” currency manipulation, and wholesale theft of U.S. intellectual property.
Despite its 40 years of market-oriented reforms, China’s economy remains in the grip of the Chinese Communist Party (CCP), state-run companies, and other Party-affiliated interests.
According to Stephen Moore, who was an advisor for Trump’s 2016 campaign, the president is angling to prevent the CCP from trying to drag the trade negotiations into 2020.
“He’s tightening the screws now, so they don’t just play a waiting game,” Moore, who is also a distinguished fellow of the D.C.-based think tank, the Heritage Foundation, said.
Trump has repeated his belief that the CCP is trying to play a waiting game with the U.S. election cycle in hopes that a Democrat candidate with more lenient foreign policy would unseat him in the 2020 race.
“I think if China had their wish, they’d wait until after the election, they’ll pray that Trump loses, and then they’ll make a deal with a stiff — somebody that doesn’t know what they’re doing,” Trump told reporters on the White House lawn on July 30.”
Previous analysis cited by Vision Times has chalked up failure of the 2018-2019 trade talks to the intensifying factional struggle in the upper echelons of the Chinese Communist Party (CCP).
Meanwhile, Xi’s reliance on ultranationalist and communist ideological rhetoric, which allowed him to wrest authority in previous years, may have backfired by leaving the Chinese leader little room for nuance in dealing with the Trump administration.
Now, concurrent developments in the U.S.-China relationship mean that the possibility of Xi and Trump reaching a trade deal is vanishingly small, according to analysis cited by France’s AFP.
“Following US criticism of Beijing’s human rights record and an open letter signed by retired US military officials urging Trump to maintain a hard line against Communist China,” it would be hard for Xi Jinping to reverse the hardliner rhetoric currently adopted by the CCP, AFP reported based on statements made by Larry Ong, an analyst at New York-based political risk consultancy SinoInsider.
“Xi’s rivals and other (Communist) Party hardliners will seize on the aforementioned developments as proof that the US wants to defeat the CCP in a Cold War-style conflict, not reach a ‘win-win’ trade agreement and revert the Sino-US relationship to the engagement era,” Ong told AFP.
Robert Spalding, a senior fellow at the Washington-based think tank Hudson Institute who used to serve on the National Security Council, said Trump’s announcement could be a sign that U.S. negotiators “realized that the Chinese just don’t want a deal.”