California hopes to boost partnerships, trade with China as trade war hurts state

Global Business

California hopes to boost partnerships, trade with China as trade war hurts state

The U.S. state of California said it’s being hurt by the ongoing trade war between Beijing and Washington. California farming exports have dropped by 14 percent and manufacturing jobs have been scaled back, according to one top state official.

CGTN’s Roee Ruttenberg reports.

“There’s no going back to the status quo,” Eleni Kounalakis, California’s Lieutenant Governor said. “We’ve got to work our way forward. And it is my hope that the administration on both sides will work forward with the spirit of friendship, and with the recognition that our corporation has been beneficial for both sides.”

Kounalakis was one of a handful of American and Chinese speakers who on Wednesday addressed the 4th annual China-California Business Council. Its aim is to boost trade by bringing together like-minded executives from both sides of the Pacific. Some 500 people attended the gathering in Los Angeles to talk about opportunities.

Chinese officials, who also addressed the group, admitted that trade friction between China and the U.S. has cast a shadow over this year’s forum. That, they said, presented a challenge. “Most importantly, we want to boost the confidence, or maintain the confidence, of our business community,” said Zhang Ping, China’s Consul General in Los Angeles, “and to try to encourage our business community to take a long-term vision.”

The Trump administration has warned it’ll slap even more tariffs on more Chinese goods, after bilateral trade talks stalled last month. Those new duties are set to take effect in mid-June.

Zhu Hong, the Chinese Minister for Commercial Affairs at China’s Embassy in Washington, denounced the tariffs, and defended Beijing’s commitment to dialogue. “The U.S. side has repeatedly broken the consensus, with exorbitant demands, ignoring China’s concerns, “said Minister Zhu, who has been involved in the trade meetings. “All these are important reasons leading to the current deadlock.”

Still, at the people-to-people and business-to-business levels, there are ongoing efforts to promote continued cooperation. Wednesday’s forum is one such example. It is essentially a networking event meant to give Chinese businesses a glimpse of California and vice versa. The message was clear: let’s work together. But there’s growing caution on the Chinese side, and growing uncertainty from California firms.

“The fact of the matter is if you focus on trade and investment opportunities and collaboration, that business will get done,” said Brian Peck, from the Los Angeles Regional Export Council. “Hopefully I think that’ll be a message that filters up to leadership of both countries, that they need to take care of business, they need to replace rhetoric with reason, and competition with cooperation.”

California is disproportionally affected by the trade tensions because it disproportionately contributes to the U.S. economy. Officials say the state accounts for around an eighth of American GDP. And while China is California’s biggest trading partner, California cannot set its own foreign trade policy. That may help explain the sense of urgency at this year’s gathering, where many fear the economic instability brought on by the trade war is here, at least for the time being.