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Officials from the United States are on their way to China to iron out the trade tensions between the two countries. The meeting will take place Thursday and Friday in Beijing.
What’s at stake?
A lot. The US-China Business Council estimates that trade with and investment in China support some 2.6 million jobs in America.
Trade in goods alone between the two countries totaled $636 billion in 2017, according to U.S. government statistics. However, Americans are buying far more from China than the other way around, which, according to President Donald Trump, is “unfair.”
Chinese officials agree that the trade relationship should be more balanced.
What will officials from the United States and China likely talk about?
The U.S. view:
The China view:
What are the bargaining chips?
Tariffs:
The Trump administration has imposed:
China retaliated against the U.S. steel and aluminum tariffs with its own penalties on 128 American exports worth $3 billion:
China retaliated against the U.S. tariffs on solar panels and washers by launching an anti-dumping investigation into American sorghum in February:
Threats of more tariffs:
U.S. lawmakers block Chinese investment and businesses:
Economic carrots:
What are the expectations for this round of trade talks?
Some U.S. businessmen operating in China have low expectations for this visit.
“This trade delegation had no team to go in first as far as I can tell,” Kent Kedl with consultancy Control Risks said.
He has been working in China for the past three decades and said the real work, whether in business or politics, is usually done in meetings in back rooms. Instead, this visit will be a meeting with senior people.
“I’ve never known that to work in China. You don’t get anybody to give you anything … that you haven’t negotiated [beforehand] already,” Kedl said.
The outcome depends on what the Trump administration is seeking.
Shaun Rein with China Market Research Group and author of “The War for China’s Wallet” said China is no longer stealing jobs from the United States, so he said if Trump hopes to move jobs back to America it is an “unwinnable war.”
“That ship has sailed decades ago,” he said.
He said Chinese officials will give enough “economic crumbs” to the Trump administration to placate it, but China will not simply unblock Facebook or Twitter and allow U.S. internet giants to operate freely because the leadership is keen on controlling information.
Jacob Parker, the US-China Business Council’s vice president of China operations, said it is “unlikely” that this meeting will resolve issues with intellectual property protection and ending forced technology transfer.
“Without the administration articulating clearly what it’s hoping to achieve … it’s very difficult for anyone to imagine what would be a success from the talks this week,” Parker said.
What the U.S. businesses he represents don’t want is for the Trump administration to impose more tariffs just for the sake of tariffs.
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