What changes has China already made to meet US trade war demands?
- Cutting car tariffs and punishments for IP infringements are among the responses from Beijing since Washington called for ‘structural changes’
- Donald Trump has welcomed some of the concessions made since a trade war truce was called in December
US President Donald Trump said on Thursday that he expects a “monumental” deal with China on trade within the next four weeks, with progress “being made at a very rapid pace” after the latest round of trade talks in Washington.
Since then, Beijing has responded with large purchases of American agricultural products and tariff cuts on US-made car imports.
It also laid out new domestic laws and regulations to address intellectual property protection and market access.
New IP regulation
On December 4, three days after the Trump-Xi summit in Argentina, China’s central economic planning body, the National Development and Reform Commission, announced 38 penalties against intellectual property violations, addressing one of the thorniest concerns in the trade talks.
Washington has accused China of state-backed hacking and intellectual property theft from the US to enrich its own technology and industrial advancement.
On Wednesday, Larry Kudlow, Trump’s top White House economic adviser, said China had acknowledged for the first time that US officials “have a point” about the intellectual property issue. Previously, he said, “they were in denial”.
Buying agriculture products
Agricultural products imported from the US had been heavily targeted by Beijing in its retaliatory measures after Washington imposed waves of tariffs on imports from China.
In early March, Trump said on Twitter that he had “asked China to immediately remove all tariffs on our agricultural products based on the fact that we are moving along nicely with trade discussions”.
Although Beijing has not yet met Trump’s demand, it had started to ease the tension over agricultural products through initial and proposed purchases.
China had proposed buying an extra US$30 billion of US agricultural products a year, including soybeans, corn and wheat, according to a Bloomberg report in January.
On December 12-13, China bought 1.5 million to 2 million metric tons of American soybeans, with shipments expected during the first quarter of 2019, according to the US Soybean Export Council.
Tariff cuts on US cars
Following the trade war truce, China rolled back the tariffs it had added on US-made cars.
Trump welcomed the announcement. “China just announced that their economy is growing much slower than anticipated because of our trade war with them. They have just suspended US tariff hikes,” he wrote in a tweet. “US is doing very well. China wants to make a big and very comprehensive deal. It could happen, and rather soon!”
Market access
Beijing rushed through the legislation, just three months after a first draft was presented for discussion, in an effort to fend off US complaints about unfair trade practices.
Fang Xinhai, vice-chairman of China’s Securities Regulatory Commission, said on January 25 on the sidelines of the World Economic Forum in Davos, Switzerland, that China would approve more applications from Wall Street banks for majority ownership in securities ventures in the next six months.
Fentanyl ban
The US has blamed China for exporting fentanyl-related substances that have led to tens of thousands of overdose deaths each year in the US. Classifying variants is aimed at preventing drug makers from producing slightly different substances to evade regulations.
Trump said at the White House on Thursday that China’s ban on all fentanyl-like drugs was “a terrific thing for the United States”. He said his ambassador to China, Terry Branstad, had also told him that “there will be criminal penalties if you sell fentanyl [in China]”.
