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Thu, 05 Dec 2019 23:03 GMT

China Does Not Want War, But Isn’t Afraid of One

Counterterrorism & Security

Karim M. Saleh

Wed, 30 May 2018 21:55 GMT

China's Foreign Ministry on Wednesday urged the United States to meet China halfway and said that it does not want trade war but is not scared of one.

“We urge the United States to keep its promise and meet China halfway in the spirit of the joint statement,” Chinese Foreign Ministry spokeswoman Hua Chunying told a daily news briefing, adding that China would take “resolute and forceful” measures to protect its interests if Washington insists upon acting in an “arbitrary and reckless manner”.

China is lashing out at Washington’s unexpected statement that it will press ahead with tariffs and restrictions on investments by Chinese companies, saying Beijing was ready to fight back if Washington was looking to ignite a trade war.

The United States said on Tuesday that it still held the threat of imposing tariffs on $50 billion of imports from China and would use it unless Beijing addressed the issue of theft of American intellectual property.

The declaration came after the two sides had agreed earlier this month to look at steps to narrow China’s $375 billion trade surplus with America, and days ahead of a visit to Beijing by US Commerce Secretary Wilbur Ross for further negotiations.

China’s Commerce Ministry reacted swiftly overnight with a short statement, saying it was surprised and saw it as contrary to the consensus both sides had reached recently.

The Global Times said the United States was suffering from a “delusion” and warned that the “trade renege could leave Washington dancing with itself”.

The widely read tabloid is run by the Communist Party’s official People’s Daily, although its stance does not necessarily reflect Chinese government policy.

“The Chinese government will have the necessary measures in place to deal with a US withdrawal from any settled agreement. If the US wants to play games, then China would be more than willing to play along and do so until the very end,” it said.

Fears of a trade war between the world’s two biggest economies had also receded after the administration of President Donald Trump said it had reached a deal that would put ZTE Corp back in business after banning China’s second-biggest telecoms equipment maker from buying US technology parts.

Still hanging in the balance, however, is San Diego-based Qualcomm Inc’s proposal to acquire NXP Semiconductors NV - a $44 billion deal that requires clearance from China’s antitrust regulators. The recent easing in tensions had fuelled optimism that an agreement was imminent.

State news agency Xinhua said China hoped that the United States would not act impulsively but stood ready to fight to protect its own interests.

“China’s attitude, as always, is: we do not want to fight, but we are also not afraid to fight,” it said in a commentary, “China will continue to hold pragmatic consultations with the United States’ delegation and hope that the United States will act in accordance with the spirit of the joint statement.”

This startled many observers as well as officials in Beijing, as the White House had for days trumpeted the outlines of an agreement for both sides to put such measures on hold while negotiators—led on the US side by Treasury Secretary Steven Mnuchin—worked on a deal to narrow the $375 billion annual trade gap by increasing Chinese purchases of US goods.


US Commerce Secretary Ross is scheduled to visit Beijing from June 2 to June 4 to try and get China to agree to firm numbers for additional US exports to the country.

The deal to reduce China’s trade surplus with the US was separate from the US probe into China’s alleged theft of intellectual property.

A White House official said on Tuesday that the US government plans to shorten the length of visas issued to some Chinese citizens as part of a strategy to prevent intellectual property theft by US rivals.

Citing a document issued by the Trump administration in December, the official said the US government would consider restrictions on visas for science and technology students from some countries.

The China Daily newspaper said the repeated US claim that Beijing had forced foreign firms to transfer their technologies to Chinese businesses was without evidence and was being used as an excuse to facilitate its trade protectionism.

It said technology transfers between US companies and their Chinese partners were the result of normal business practices, not coercive policies.

Technology transfer was a normal commercial activity that benefited the United States most of all, he said, while Chinese innovation was driven by “the diligence and entrepreneurship of the Chinese people, investment in education and research, and efforts to improve the protection of intellectual property.”

Legal experts say Washington needs WTO backing to implement its tariffs as far as they relate to WTO rules, while China has rejected the tariff plan wholesale and resorted to WTO action to stop it.

Under WTO rules, if disputes are not settled amicably after 60 days, the complainant can ask for a panel of experts to adjudicate, escalating the dispute and triggering a legal case that takes years to settle.

William Zarit, chairman of the American Chamber of Commerce in China, said Washington's threat of tariffs appeared to have been "somewhat effective" thus far.

"I don't think it is only a tactic, personally," he told reporters on Wednesday, adding that the group does not view tariffs as the best way to address the trade frictions.

"The thinking became that if the US doesn't have any leverage and there is no pressure on our Chinese friends, then we will not have serious negotiations."


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