After a five-month pause, the U.S. and China are back in a trade war and it could soon get worse for both sides. Crucial negotiations in Washington ended Friday without a deal, just as President Donald Trump ordered officials to start the process of raising tariffs on all Chinese imports. CGTN’s Nathan King has details.
Handshakes and waves in front of the cameras after 11 rounds of trade talks and the Chinese and U.S. negotiators know each other well.
But these negotiations stood little chance. At midnight Thursday, tariffs on $200 billion worth of Chinese imports rose from 10 to 25 percent. As the talks started, China’s Vice Premier Liu He indicated negotiating under such a cloud was unlikely to produce results.
“I came here with good faith and sincerity,” Liu He said. “Under the current circumstances, we hope to exchange views with our U.S. counterparts in a rational, candid manner. China believes additional tariffs is not the way to solve the problem.”
The first round of talks Thursday lasted little over an hour. There was a dinner, but even that was brief. Negotiations resumed Friday morning, but that meeting, too, was short. By then, the U.S. tariffs had kicked in.
The U.S. president had already started tweeting, spinning his latest turn around on trade talks.
Talks with China continue in a very congenial manner – there is absolutely no need to rush – as 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….
— Donald J. Trump (@realDonaldTrump) May 10, 2019
The reality is that U.S. importers pay the tariffs. The higher costs get passed on to U.S. businesses, and eventually, to American consumers. While the U.S. president argues that tariffs work, economic theory and the trade figures suggest otherwise.
Before heading back to Beijing Liu He shared his thoughts on the way forward.
“The talks didn’t break down. Both sides clarified each’s stances and discussed the content for the next round of consultation. Both sides also maintained relatively good communication and cooperation. Therefore I don’t think the talks had broken down. On the contrary, it’s normal to have minor setbacks or detours in talks. It’s inevitable. We’re cautiously optimistic,” Vice Premier Liu He told reporters.
Chinese exporters will be hit, of course, but so too will U.S. companies and farmers who thought the pain may come to end soon. China said it will respond with “countermeasures” to the U.S. latest tariffs. We await the details.
Whether this latest U.S. tariff hike is a last-minute negotiating ploy or the opening shot in an escalating trade war remains to be seen. What is not up for debate is that more economic uncertainty is on the way for both the American and Chinese people.
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