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Presidents Trump and Xi will meet in Buenos Aires this week, but it seems neither China nor the US is in conciliatory mood
There are hopes, however limited, that the meeting between the two leaders in Buenos Aires will result in a calming of tensions which have so far resulted in huge share price drops, most notably in US tech stocks.
“Regulations are still proceeding in a direction that appears contrary to the values of fairness and clarity. We would like to see the Chinese government offer reciprocal treatment to US companies so they feel welcomed in China in the same way that Chinese companies have been welcomed in the US,” said Zarit.
The two countries game of tit-for-tat tariffs on each others goods has rumbled on for months, as Trump tries to fulfil his pledge to help create more US manufacturing jobs. The tariffs have been blamed for a weakening of Chinas mighty manufacturing sector, which earlier this month showed a marked slowdown. Three rounds have been imposed on Chinese goods by the Americans, while China has done the same with $110bn of American goods.
Video: Trumps leverage in China trade talks
Why a US-China Tariff Ceasefire Is Coming Soon | by Anatole Kaletsky
Trump has threatened to slap tariffs on the remainder of Chinas $500bn-plus exports to the US if the disputes cannot be resolved.
LONDON – The meeting between US President Donald Trump and Chinas President Xi Jinping at the G20 summit in Buenos Aires this week is being viewed as a make-or-break moment for the world economy and financial markets. But even if no agreement is reached at the summit, there are at least four reasons to expect a de-escalation of the US-China tariff war.
Suggestions that the impasse might be resolved have been met by surging stock prices. Earlier this month, Asian shares jumped when reports emerged that Trump wanted to reach an agreement with the Chinese, with the president tweeting that talks were moving along nicely.
In the new China-US cold war, will Xi or Trump blink first? | TheHill
A few days later, in remarks meant to portray his country as a champion of globalisation as it remains locked in the trade war, Xi promised to lower import tariffs and improve access to the Chinese market. However, while Xi claimed China had entered a new round of high-level opening-up, he did not make any concrete concessions to the White House.
Apples products are currently exempt from the tariffs. It previously announced that the tariffs would affect the Apple Watch, AirPods and other products, but were spared when the tariffs were announced. Although iPhones are assembled in China, several parts come from the U.S.
By last week the outlook did not appear so rosy. China has not fundamentally altered its unfair, unreasonable and market-distorting practices, said US trade representative Robert Lighthizer. That came after Asia-Pacific leaders had failed to bridge gaping divisions over trade at the Apec summit in Papua New Guinea. For the first time, leaders were unable to agree on a formal written declaration, amid sharp differences between the worlds top two economies over the rules of global trade.
Having emerged as the world’s strongest nation during and after World War II, US foreign policies have one goal: Shape the world to its image. That process began at the 1944 Bretton Woods Conference, insisting on using the US dollar as the world reserve currency and writing the trade rules. In this way, the US has accumulated a very powerful tool, printing as much money as it wants without repercussions to itself. For example, when a country wants to cash its US Treasury holdings, all America has to do is print more greenbacks.
Will Trump bring America down?
Vice-president Mike Pence said the president was prepared to more than double the tariffs, and that the USs strategy would not change until China changed its practices.
Also last week, White House adviser Larry Kudlow said that he expected there to be a direct confrontation between the two countries over trade at the G20: this after a delegation of Chinese cancelled their trip to Washington for talks. It will come to a head at the G20 – I think thats the key point, he said. Trump had previously said that 142 concessions offered by China were not acceptable – although he suggested a deal could be struck before the new year.
Commentators have said that any positive moves, even to keep on talking, would help settle the markets and further tensions would prompt investors to hold on to their money.
Video: The Heat: Previewing the G20 and the Xi-Trump meeting Pt3
Trump says he expects to raise China tariffs: Wall Street Journal
The meeting between the two leaders will not be the only thing worth watching at the G20: Saudi crown prince Mohammed bin Salman, widely suspected of ordering the murder of journalist Jamal Khashoggi, is expected to attend.