September 17, 2018

New Hope For U.S-China Negotiations?

On Wednesday, Sept. 12, The Wall Street Journal reported that U.S. government officials, led by Treasury Secretary Steve Mnuchin, had proposed a new round of trade talks with China in the near future. Though he did not offer many details, later in the day, Larry Kudlow, President Donald Trump’s top economic adviser, confirmed the U.S. government “extended” an invitation to their Chinese counterparts to meet.

A day later, however, President Trump said in a post on Twitter that “The Wall Street Journalhas it wrong, we are under no pressure to make a deal with China, they are under pressure to make a deal with us.” There was no clarity on the path forward with China by the end of the week, and over the weekend reports were that President Trump plans to go ahead with plans to impose 10 percent tariffs on an additional $200 billion in Chinese products later this fall. It also came after the Chinese government asked the World Trade Organization (WTO) earlier in the week to impose $7 billion in sanctions annually on the United States “in retaliation for Washington’s non-compliance with a ruling in a dispute over U.S. dumping duties.”

The penalties stem from a 2013 challenge brought by China that the country won in 2016. As Reuters explains, the case concerns the U.S. Commerce Department’s way of calculating Chinese exports that are priced to undercut American-made goods on the U.S. market. Reuters said the calculations “tended to increase the level of U.S. anti-dumping duties on foreign producers and was repeatedly ruled to be illegal in a series of trade disputes brought to the WTO.”