MNI INTERVIEW: Trade War Dependent US Moves:China Govt Advisor

By Iris Ouyang

     BEIJING (MNI) - Whether or not a trade war between China and the U.S.

occurs in the near term depends more on Washington as Beijing is still open for

negotiations, a trade advisor for the Chinese government said in an exclusive

interview with MNI.

     "China has not shut the door to negotiate with the U.S.," said Liu Yingkui,

director of the China Council for the Promotion of International Trade, a trade

consultation group managed directly by the State Council.

     Liu's comment came after the China-U.S. trade conflict escalated Friday, as

China toughened its stance on trade issues with the U.S.

     China's embassy in the U.S. underlined the tougher response, saying China

will "fight to the end" if Washington insists on starting a trade war.

     Cui Tiankai, China's ambassador to the U.S., upped the rhetoric, saying "We

will retaliate. If people want to play tough, we will play tough with them and

see who will last longer", according to a video on the embassy's social media

page.

     --FURTHER ACTION

     Although China's initial reactions are restrained, it's changing stance

could indicate more could come.

     In the past, when perhaps China had a weaker standing, it compromised or

negotiated when it had trade conflicts with the U.S., but now China has more in

its toolbox, Liu told MNI.

     Referring to China's action in response to the latest U.S. trade measures,

Lui noted Beijing was not the perpetrator.

     "China is forced into taking such action, and the U.S. still has the

initiative" to ignite a trade war, as China will not be the one to start one,

Liu said.

     --BEIJING RETALIATION

     China has prepared $3 billion in tariffs on U.S. imports in response to the

Trump administration's measures to charge additional tariffs on Chinese steel

and aluminum, the Ministry of Commerce said on its website on early Friday. The

ministry said, if the U.S. fails to compensate for China's losses, a 15%-25%

tariffs could be imposed onto U.S. products ranging from fruits, denatured ethyl

alcohol and seamless steel pipe as well as pork-related products and recycled

aluminum.

     The ministry's statement came just hours after President Donald Trump

ordered tariffs of $50 billion on imports from China for intellectual property

protection reasons. 

     Previous negotiations between the two countries have appeared unfruitful,

largely because the U.S. attitude and requirements are above what China can

offer, Liu noted.

     If the U.S. considers Chinese concerns and both sides make comprises, risks

of trade war are controllable, Liu said. But if the U.S. continues its

aggressive and inflexible stance, Liu added, China will retaliate and a

small-scale trade war will ensue.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

--MNI Beijing Bureau; +86 (10) 8532-5998; email: iris.ouyang@marketnews.com

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