China-US Geopolitics: News & Discussions

[meis]

China tosses a trade bone to the White House
https://www.ft.com/content/40e77a5c-1de6-11e7-b7d3-163f5a7f229c

Beijing’s decision is economically insubstantial but politically savvy.

Nearly 40 years since starting to liberalise its economy, China’s adoption of a fully fledged market economy is still far from complete. But one thing it has picked up from the democratic capitalist west along the way is an ability to spin small changes in policy to placate its international partners.

China showed its prowess in this area by offering some trade liberalisation measures following Xi Jinping’s meeting with Donald Trump in the US last week. Beijing is ready to lift a hygiene-related ban on American beef imports, which has been in place since 2003, and remove some restrictions on foreign companies investing in its financial services sector. By giving Mr Trump some impressive-sounding victories to tout at home, China may hope to forestall some of the wilder protectionist acts the US president has been threatening. Yet ironically, one of the outcomes it is keen to avoid — having the administration label China a currency manipulator — is one for which there is no basis and hence it can do little to affect. It is genuinely innocent.

China’s decision was designed to make a big noise without necessarily changing very much. The pronouncement on beef involved a highly symbolic American product. The agreement to open its financial services sector, meanwhile, may not make a dramatic difference in reality. Western companies are likely to be chary about plunging into a debt-laden Chinese financial system.

The selective nature of Beijing’s policy change underlines the fundamental problem with its trade and regulatory policy. Despite more than 15 years’ membership of the World Trade Organization, China’s economy remains resistant to foreign investment in many sectors and its trade is distorted by regulatory interference.

This week’s offer is not a substitute for substantive liberalisation, particularly in the service sector. Rather than threatening WTO-illegal actions on tariffs, Mr Trump’s administration would do better to pick up negotiations with Beijing on a bilateral investment treaty, which were left over from Barack Obama’s administration and could deliver considerable access to Chinese service markets.

In the nearer term, Mr Trump faces the decision of whether to follow through with a manifesto promise that will have very little effect in practice, except to inflame diplomatic tensions. On the campaign trail, he promised to designate China as a currency manipulator on day one of his administration. The US Treasury’s biennial currency report, due to come out later this week, provides him with an opportunity.

There are, however, two rather substantial problems with doing so. One is that such a designation has no impact whatsoever beyond compelling the US Treasury to negotiate with China, which it is already doing. The second is that China is desperately trying to prop up its currency to prevent financial instability, not hold it down to give it competitive advantage. It is in no one’s interest, including the US, if Beijing suddenly stops intervening to defend the renminbi and a destabilising rush of capital flight and sharp devaluation follows.

The US administration is learning that making substantial and constructive gains in trade negotiations is slow incremental work. It is to be hoped that Mr Trump does not get frustrated with the pace of change and unleash the destructive policies he promised before he came to office.

China will not offer him rapid and widescale liberalisation. But accepting what it can get and carefully and continuously pushing for more is America’s best course of action.

My 2c:
Trump and his new found bone. He must be very proud of it. Oh, thanks for that GMO beef.
Read the comment section over there.

 

[TaiShang]

China tosses a trade bone to the White House
https://www.ft.com/content/40e77a5c-1de6-11e7-b7d3-163f5a7f229c

Trump and his new found bone. He must be very proud of it. Oh, thanks for that GMO beef.

Let him (figuratively) gnaw on it a while. Besides, his hands are now full with foreign issues like regime building in Syria and North Korea.

MAGA was just a different tune of the same song. Or as they say, same crap, different shades of color.

Also, I do not think the trade balance will improve in any meaningful way as the US spends more on military, not less.

And the FT article (paid) sums it up: "Beijing’s decision is economically insubstantial but politically savvy."

 

[ahojunk]

Xi and Trump discuss Korean Peninsula, Syria over phone
(Xinhua) 13:49, April 12, 2017

Chinese President Xi Jinping meets with US President Donald Trump at the Mar-a-Lago Resort
in Florida on Thursday afternoon April 6, 2017. [Photo: Xinhua]​

BEIJING, April 12 (Xinhua) -- Chinese President Xi Jinping on Wednesday held a telephone conversation with his U.S. counterpart, Donald Trump, and discussed the situation on the Korean Peninsula and in Syria.

Xi said that China sticks to the target of the denuclearization of the Korean Peninsula and that China is committed to peace and stability of the peninsula.

China holds that the issue should be solved through peaceful means, said Xi, adding that his country is ready to maintain communication and coordination with the United States on the issue.

On Syria, Xi said that any use of chemical weapons is unacceptable and that the path of political settlement should be followed.

He expressed the hope that the UN Security Council would speak in one voice as it is important for the Security Council to remain united over the issue.

Xi also asked teams of China and the United States to work together closely to make sure that Trump's visit to China later this year could achieve fruitful results.

He also urged the two sides to promote economic cooperation, expand exchanges in military, law enforcement, cyber and people-to-people areas, enhance communication and coordination in major global and regional issues, through the newly established four-pronged dialogue mechanism.

He expressed the hope that the dialogue mechanism will yield as many early-stage results as possible so as to inject impetus to bilateral relations.

The four-pronged dialogue mechanism, which covers the fields of foreign affairs and security, economy, law enforcement and cybersecurity, social and people-to-people exchanges, is an important result of Xi's meeting with Trump in Florida.

Xi said his recent tete-a-tete with Trump in the latter's Mar-a-Lago estate in Florida has produced important results, which have won positive response among the Chinese people and the international community.

The two leaders held in-depth discussions and reached important consensus on bilateral relations in the new era and on major global and regional issues, said Xi.

He and Trump have increased mutual understanding and established sound working relations, he added.

In Wednesday's phone conversation, Trump said the meeting with Xi at Mar-a-Lago was a success. It is very important for the two presidents to maintain close communication, he added.

Trump agreed that the two sides should work together to promote pragmatic cooperation in wide-ranging areas.

He said he was looking forward to his state visit to China this year.

The two presidents agreed to keep close communication through all kinds of channels.


********

The big two are in close and constant contact, like it or not.
.

 

[bobsm]

Trump backs away from labeling China a currency manipulator

By David Lawder | WASHINGTON

President Donald Trump said on Wednesday that his administration will not label China a currency manipulator, backing away from a campaign promise, even as he said the U.S. dollar was "getting too strong" and would eventually hurt the economy.

In an interview with The Wall Street Journal, Trump also said he would like to see U.S. interest rates stay low, another comment at odds with what he had often said during the election campaign.

A U.S. Treasury spokesman confirmed that the Treasury Department's semi-annual report on currency practices of major trading partners, due out later this week, will not name China a currency manipulator.

The U.S. dollar fell broadly on Trump's comments on both the strong dollar and interest rates, while U.S. Treasury yields fell on the interest rate comments, and Wall Street stocks slipped. [FRX/][US/][.N]

Trump's comments broke with a long-standing practice of both U.S. Democratic and Republican administrations of refraining from commenting on policy set by the independent Federal Reserve. It is also highly unusual for a president to address the dollar's value, which is a subject usually left to the U.S. Treasury secretary.

"They're not currency manipulators," Trump told the Journal about China. The statement is an about-face from Trump's election campaign promises to slap that label on Beijing on the first day of his administration as part of his plan to reduce Chinese imports into the United States.

More @ http://www.reuters.com/article/us-usa-trump-currency-idUSKBN17E2L8

 

[TaiShang]

"They're not currency manipulators," Trump told the Journal about China.

Same old, same old.

Oligarchic US regime model is a blessing. They can easily walk back on their promises even if they are made publicly.

 

[ChineseToTheBone]

That is hilarious. He has walked back on every statement he made about China during his campaign.

 

[8888888888888]

I think China gave him a lot of concessions for his family behind the scenes and gave him a lot of respect by making him look good.

 

[shadows888]

I think China gave him a lot of concessions for his family behind the scenes and gave him a lot of respect by making him look good.

we have a winnerrr!!!

 

[terranMarine]

I think China gave him a lot of concessions for his family behind the scenes and gave him a lot of respect by making him look good.

You hit the nail , yes we did not bribe Trump but instead gave him and his family concessions. In return for our services he told the press China is not a currency manipulator.

 

[bbccdd1470]

Same old, same old.

Oligarchic US regime model is a blessing. They can easily walk back on their promises even if they are made publicly.

True, Trump is breaking or failing almost every promise he made during election, such as the investigation of Hillary Clinton, stopping the war in Syria, cancel the Obamacare (his fault if he can not control his party), make Mexico paying for the wall, and trade war with China etc. I suspect he is either part of the establishment or the shadow government have too much power over him, anyway I'm now pretty sure that "America is going to great again" will be a failure like the other promises I listed above.

 

[Shotgunner51]

China tosses a trade bone to the White House
https://www.ft.com/content/40e77a5c-1de6-11e7-b7d3-163f5a7f229c

Very interesting narrative, more interesting is that this came from a UK-based media.

 

[Tiger Genie]

US missile strikes violated all red lines on Syria: Russia, Iran, allied forces

http://www.presstv.com/Detail/2017/...violation-red-lines-Russia-Iran-allied-forces


World is going to start world war 3 and Indians are only concerned about Chinese trade surplus and Cows. Dear Indians this a new century you need to start treating animals as animals and humans as humans. Please stop being jealous about Chinese trade surplus.

not jealous but it continues to be a drain on our resources. Restoration of manufacturing jobs - whatever is left of it after the massive automation - is still something we need. India, China, Europe - these are big markets but exporting only high tech to them is insifficient

 

[8888888888888]

FT is own by Japan

 

[Shotgunner51]

Breaking news, the most pressing deal pending for US government review as per Bloomberg - Stillwater Mining Co - has just been given green light by CFIUS, see the attached news links. Stillwater is the sole U.S. source of platinum and palladium, materials that have strategic importance and military applications. Its proposed acquirer, Sibanye Gold Ltd., is a South African gold miner whose biggest shareholder is a consortium with ties to China’s government.

http://finance.yahoo.com/news/stillwater-mining-company-announces-cfius-120000013.html
https://www.bloomberg.com/news/arti...security-nod-to-buy-stillwater-platinum-mines
https://defence.pk/pdf/threads/montana-mines-to-test-trump-teams-appetite-for-china-deals.488842/

 

[ahojunk]

Sino-U.S. trade greatly benefit people of both countries, world economy
By Dr. Ulf Henning RICHTER and Yuanyu MU (Xinhuanet) 19:21, April 13, 2017

Chinese President Xi Jinping met lately with U.S President Donald Trump in Trump’s private mansion Mar-a-Lago in Florida, the first official meeting since the new U.S.government took office in January.

The two world leaders aimed to open a new page of their bilateral relationship and discuss issues of common concern, in particular the large U.S. trade deficit with China which may cause protectionist measures by the U.S. and other issues in the " four pillar" dialogue mechanisms.

Trade between the two economic giants has increasingly drawn the public’s attention. The bilateral trade volume amounted to 519.6 billion dollars in 2016, and continues to grow. However, the U.S. trade deficit with China is rather troublesome for a president that has been swept to power by the slogan “America First”.

Sino-U.S. trade has greatly benefited the people of both countries, and the world economy at large. The trade deficit has been caused by the growing hunger of the U.S. for cheap consumer goods such as electronics and clothing, as well as machinery.

The trade deficit only tells half of the tale though since many U.S. manufacturers have outsourced production, shipping raw materials or low value parts for assembly to China, and re-importing the finished goods back to the U.S., most famously Apple’s iPhone manufactured by Foxconn.

President Xi has successfully turned China’s inward-looking politics focusing on economic development and urbanization towards a positive, open, outward oriented program through his One Belt, One Road initiative.

His government is on the fast track in developing frameworks for its future role in global governance, focusing on connecting China and Eurasia and economic cooperation, emphasizing China’s growing maturity on the global stage.

The foundation of the Asian Infrastructure Development Bank (AIIB) as one of its key policy instruments manifests Beijing’s drive for a multipolar system. As of today, the AIIB has deployed more than 2 billion dollars in infrastructure loans with an expected 10-15 billion dollars a year for the first five or six years.

China strongly believes in the benefit for both nations to stay open and collaborate on key issues of global security and economic prosperity. Xi mentioned to Trump there are "a thousand reasons" to make the China-U.S. relationship work, and "no reason to break it."

Economic globalization, and Sino-U.S. trade in particular, has powered global growth and facilitated movement of goods and capital, advances in science, technology and civilization, and interactions among peoples.

For instance, in Los Angeles, Chinese firms are already among the largest real estate investors. China’s CRRC Corporation is now building metro cars for the mass transportation systems in Chicago and Boston, having invested in local factories and thereby creating jobs for the American people.

Many new Hollywood movies star Chinese actors to make them attractive for the Chinese public, and are often funded by Chinese investors. Most prominently Dalian Wanda acquired Legendary Entertainment, the Hollywood production company behind such blockbusters as “Jurassic World” and “The Dark Knight”.

The U.S. education system remains highly attractive to Chinese students. U.S. universities host an increasing number of self-financed Chinese students.

China and the U.S. also cooperate in running schools, such as the Chinese campus of Duke University in Kunshan City, Jiangsu Province, and the Shanghai New York University, and most recently the MIT supply chain research center in Ningbo, Zhejiang Province.

The growing economic interdependence is accompanied by an exchange of technology and talents which creates ample opportunities for both the U.S. and the Chinese people. In the U.S., public confidence in economy has increased, especially after the Federal Reserve rate hike in March. As a result, “concerns about U.S. debt, job losses and trade deficits have generally eased”, as a survey powered by Pew Research Centre suggested. The proportion of U.S. citizens who see the trade deficits as a severe problem has declined by 17 percent compared with the figure five years ago. The same survey suggested that young U.S. citizens seem to become more open and closer to China. With growing mutual understanding and economic prosperity enjoyed by both sides, a peaceful coexistence and common prosperity will be possible. The Xi-Trump meeting has provided a healthy starting point for consensus building especially in the issue of bilateral trade to open a new chapter in the relationship of the two giants.