Home / News / World /  Will China, US pull off a deal, avert full-blown trade war?

Talks to avert a full-blown trade war between the US and China in Washington on Thursday will suggest whether the Trump administration can manage to secure a trade deal with Beijing at a gunpoint. The US trade representative’s office has already filed the formal paperwork for another round of increase in duties on Chinese goods.

The new round of the additional duties from 10% to 25% on $200 billion worth of Chinese goods will come into effect on 12 am Friday (10 May). The Chinese commerce ministry has also announced that it would impose necessary counter measures if Washington resorts to increasing tariffs on Chinese imports on Friday.

Against this backdrop, the 11th round of US-China trade talks will test the resolve of Washington and Beijing whether they could avoid an escalating spiral of tit-for-tat trade tariffs. US President Donald Trump has already declared success even before the start of the talks. He said Chinese Vice Premier Liu He is coming back to the negotiating table with the intention of making a trade deal. President Trump charged the Chinese of attempting to walk back from the negotiations in the hope that they would be able to get a more favourable deal “with Joe Biden or one of the weak Democrats" running for President.

In a series of tweets on 8 May, according to a report in Washington Trade Daily on 9 May, President Trump boasted that he will not let China secure a favourable deal. “Guess what, that’s not going to happen," he boasted. Trump told his supporters at a campaign rally in Florida on 8 May that if China does not agree to a deal then Beijing will face the consequence of increased tariffs. He claimed if trade with China stops because of the new round of tariffs then he would create an enabling environment for setting up industries in the US. Chinese leaders “broke the deal" in trade talks with the US, Trump added.

“China has just informed us that they (Vice Premier) are now coming to the US to make a deal. We’ll see, but I am very happy with over $100 billion a year in Tariffs filling US coffers…great for US, not good for China!" he tweeted. According to several US media reports, the US collected around $34 billion because of additional tariffs last year. The new round of additional tariffs of 25% on Chinese goods, if they are imposed on Friday, will increase the overall revenues to $100 billion.

Following the 10th round of trade talks last week in Beijing, the US chastised China for seeking to renege on its commitments, rendering the 150-page draft agreement redundant. The US demanded comprehensive changes in China’s domestic laws to prove it would not renege on the deal. China, however, refused to yield to Washington’s demands to address a range of issues that would make the agreement look like an unequal treaty. The US is not ready to provide guarantees that Washington would remove the tariffs once China has fulfilled its side of the bargain, said a Chinese trade official, who asked not to be identified.

Further, China’s hardline tactics, according to a report in the Wall Street Journal on 9 May, “came after Beijing interpreted recent statements and actions by President Trump as a sign the US was ready to make concessions."

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