Politico | Hope fades that US-China deal will substantively tackle subsidies
- US Chamber of Commerce’s head of international affairs Myron Brilliant says two sides are struggling to close the gap issues such as how to roll back tariffs
- Chinese delegation led by Vice-Premier Liu He is set to arrive in Washington next week to begin what could be final round of talks
This story is published in a content partnership with POLITICO. It was originally reported by Adam Behsudi on politico.com on May 2, 2019.
US businesses are tempering their expectations that a trade deal with Beijing will force China to significantly cut back on its state subsidies.
“We’re likely to get language that … touches on transparency, but we’re not likely to get the commitment that we want from the Chinese, in terms of they’re really cutting back and eliminating subsidy practices, not just in the steel and aluminium sectors but in a range of sectors,” said Myron Brilliant, the US Chamber of Commerce’s head of international affairs.
China’s complex web of subsidies and tax preferences are central to the US argument that American firms operate at a competitive disadvantage in one of the world’s largest markets. They are also blamed for massive overcapacity in China’s industrial sectors, fuelling a flood of steel, aluminium and other goods that have saturated the world market in recent years.
Brilliant, who spoke on a call to reporters on Thursday, said the chamber was “sanguine” about the amount of progress that could be made on subsidies in the context of the US-China trade talks, but he added that the issue is not likely to go away.