US-China Trade Talk Crashes; Another Economic War in the Cards

Last updated on May 13th, 2019

Playing the same monody for months, President Donald Trump and his close aides continuously billed progress in talks with China, yet it once again came crashing down. The failure led to Trump announcing tariffs on Chinese goods worth $200 billion in an effort to put pressure on Beijing.

The increased tariffs implied a tremendous rise from 10% to 25% on. On the other hand, China to US’ move said that it would also put retaliatory tariffs on the US’ goods.

The escalation implies that their might not be a way forward for two sides, who have been fighting it over for months. The recently concluded talks between the Trump administration and a Chinese delegation, led by Vice Premier Liu He, were expected to reach some sort of conclusion, yet failed to provide any sort of assurance.

Deadlocked for months, the situation always appeared to be hanging by the cliff. Especially because there was nothing official, even when Trump continuously gave assurances over progress.

China and the US looked on course for a while after the multiple outlets reported that Beijing was readily accepting changes, however the result went otherwise. The changes as reported included backing away from the 150-page draft deal last Friday, and refining terms of commitments throughout the entire document.

“We’re moving backwards instead of forwards, and in the president’s view that’s not acceptable,” US Trade Representative Robert Lighthizer said Monday. “Over the last week or so, we have seen an erosion in commitments by China.”

Besides, during the meetup at Washington, Beijing also resisted the US demand that it would change some of its laws as a part of the trade deal. As per the reports, the Trump administration was expecting to settle the China’s practice of forged technology transfers. This means restraining the US companies doing business in China from sharing the proprietary information.

Thereby, expecting the changes to take place at a rapid pace, China even lost all that it could have gained from the meeting. But, why did they do so is still not known, said Bonnie Glaser, China’s expert at the Center for Strategic and International Studies.

“I just don’t think that we’re in a place where they (US) will agree, ‘let’s have a new round of negotiations in a week or two.” “There just doesn’t seem to be any basis right now to do that,” the expert added.

Meanwhile, even before the negotiations ended on Friday, Trump in his tweet described the event as congenial” — but said that there was “no need to rush” because “Tariffs are NOW being paid to the United States by China of 25% on 250 Billion Dollars’ worth of goods & products. These massive payments go directly to the Treasury of the U.S.”

Nonetheless, the reality is that situation is not in anyone’s favor. Trump’s additional tariffs imply that the prices will likely increase for consumers and may hurt manufacturers and others who heavily rely upon Chinese goods.

Thus, the situation only renews the fear of the trade war escalating again, causing havoc for both the economies. Resulting in the significant disturbance of the demand and supply forces in the process.

Write a response

Leave a Reply

Your email address will not be published. Required fields are marked *

True News Source © Copyright 2018. All rights reserved.