China cancels trade talks with US

Gladys Abbott
September 24, 2018

Beijing cancelled the visit of a Chinese negotiating team expected September 27-28 in Washington, The Wall Street Journal said. Bloomberg reported that the white paper stated that trade negotiations "cannot be carried out under the threat of tariffs", suggesting talks between the two sides are unlikely. American regulators tried to limit the public impact by focusing on industrial machinery and components, but the latest $200 billion list includes bicycles, wooden furniture and other consumer goods.

"We are going to win it", Trump's Secretary of State Mike Pompeo said of the trade war on "Fox News Sunday".

If the president follows through on the escalation threat, USA tariffs would cover all goods the nation imported from China a year ago, risking an escalating conflict that could upend the supply chains of multinational companies.

Naturally, China retaliated with increased duties on American imports worth $60 billion in what Beijing has described as the "largest trade war in economic history".

Released on Monday by the official Xinhua news agency, Facts About the China-US Trade Dispute and China's Stance, is the first comprehensive document from President Xi Jinping's administration on the new economic Cold War. Earlier, he threatened Beijing with further tariffs on around $267 billion of imports if Beijing retaliates against the latest measure.

Trade talks in Washington last month produced no meaningful progress.

U.S. tariffs on $200 billion worth of Chinese goods and retaliatory tariffs by Beijing on $60 billion worth of USA products took effect at midday Asian time, though the initial level of the duties was not as high as earlier feared.

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"Should the escalation go further, the economic costs for both countries and around the world will quickly add up", International Monetary Fund spokesman Gerry Rice said last week.

On Monday, the ratings agency Fitch cut its forecasts for next year's Chinese and global economic growth by 0.1 percentage points to 6.1 percent and 3.1 percent, respectively.

The products spared also include smartwatches and Bluetooth devices like the iPhone and Fitbit, child safety products such as high chairs, vehicle seats and playpens, and certain health-and-safety products such as bicycle helmets, United States officials said.

Despite the ballooning trade deficit, there are bigger issues at stake for the U.S., such as containing China's rise as it moves towards economic superpower status through its "Made in China 2025" policy and the $1 trillion Belt and Road Initiative.

China summoned the USA ambassador in Beijing and postponed joint military talks in protest against a USA decision to sanction a Chinese military agency and its director for buying Russian fighter jets and a surface-to-air missile system.

China outlined a matching bump in tariff rates for its targeted $60 billion of United States goods, but it is running out of options to even the score on Trump's threatened third wave of tariffs.

The two are also at odds over Beijing's wooing of Taiwan's diplomatic allies, treatment of religious groups and claims to disputed islands in the South China Sea.

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