U.S. breaking promises is setting new obstacles for trade talks with China
By Zhong Sheng
The 12th round of the China-U.S. high-level economic and trade consultations concluded at the end of July, and the negotiating teams of the two countries agreed to intensify trade consultations in August to prepare for the meetings of chief trade negotiators from both sides in September.
However, the U.S. had a sudden turnabout and unilaterally claimed to impose an additional 10 percent tariff on $300 billion worth of Chinese imports starting from September 1.
This move goes against the consensus reached by the heads of state of the two countries during their meeting in Osaka, Japan, posing serious problem to the trade talks.
In fact, it was not the first time that the U.S. went back on its own words and challenged the fundamental norms of international relations.
On June 29, the U.S. promised in Osaka that it would not add new tariffs on Chinese goods, which was regarded as quite a relief for the international market.
However, on August 1, just 27 hours after the White House published a statement acknowledging the 12th round of China-U.S. high-level economic and trade consultations as “constructive” meetings, the U.S. once again picked up the big stick of tariffs and wielded it against China.
The U.S. decision hurt the confidence of the international market, causing a sharp fall in the American stock markets that further led to a slump in global stocks – obviously an inevitable consequence of the arbitrary and capricious acts of some American officials.
Evidently, these American officials are anxious about the economic problems their country is currently facing.
According to the latest data released by the U.S. Department of Commerce, U.S. GDP grew at a 2.1 percent annualized rate in the second quarter this year, slower than the 3.1percent figure in the first quarter, signaling insufficient drivers of economic growth.
In addition, the economic and trade frictions with China also aggravated the vulnerability of U.S. agricultural products in global market.
A drowning man will clutch at a straw, but he should never blame the others for his own awkward situation.
To every economy in the world, the global market, which is interdependent and coordinated, is like an ecological system. In such system, any act that runs counter to the fundamental laws will lead to catastrophic results. This also applies to the global market.
The uncertainties created by the additional tariffs would inevitably shatter the confidence and ecology of the market. Under such circumstances, no enterprise will take the risk to place orders of American products without hesitation.
China is a market economy where whether to increase imports from the U.S. is ultimately decided by the market entities, as market behavior is determined by market conditions and expectations.
The crux of the current problem is that the U.S. side keeps reneging on its word, making trade a dangerous game for marker buyers who dare not to make a purchase.
Obviously, to boost the Chinese purchases of U.S. products, Washington should faithfully safeguard the order and stability of the market, rather than waving the big stick of tariffs.
The tragedy of the present American agriculture is exactly an outcome of the wrong decisions made by the U.S., and has nothing to do with other countries.
The situation was totally different before the China-U.S. trade frictions broke out. The market was free from destructive interference, and both sides enjoyed common benefits from the supply chain on which the U.S. generated huge production and China saw huge demand.
Unfortunately, it will not be easy to restore this supply chain after it had been severely impacted. The story indicated the wisdom drew by ancient Chinese 2,000 years ago – unvarnished truth is better than a cunning ruse.
China has always regarded the consensus reached between the heads of state of the two countries as an important guideline for resolving economic and trade issues, and is willing to actively expand imports according to the demand of domestic market and its people.
The two sides have agreed to open market to each other. China will, in the process of furthering its new round of reform and opening-up, work to gradually resolve the reasonable concerns of the US side. Work teams of both sides will step up negotiations toward the removal of all additional tariffs so as to reach a specific agreement with mutual benefit and win-win results at an early date.
Honoring promises and following the consensus between China and the U.S. would no doubt benefit the development of the two countries and the well-being of the two peoples, and contribute to the stable growth of world economy, which accords with the interests of various countries.
As Chinese idioms go that “a promise is weightier than one thousand bars of gold” and “people should suit their actions to their words”, Chinese people have always attached great importance to keeping promises and honoring commitments.
“Honesty is the crux of all standards of conduct.” Such philosophy is deeply rooted in Chinese culture, and is still cherished by the Chinese people as a defining principle when it comes to dealing with relationships.
(Zhong Sheng is a pen name often used by People’s Daily to express its views on foreign policy.)