China and the United States will hold a new round of economic and trade consultation in Beijing on January 7-8 and the international community is wondering whether the two sides can reach a consensus within two days. According to Wei Jianguo, former Vice Minister of Commerce and Vice Chairman of the China Center for International Economic Exchanges(CCIEE), China and the United States are well aware of their goals and have learnt their lessons from the previous negotiations, therefore, the China-U.S. economic and trade consultations are likely to produce positive results.
The China-U.S. economic and trade consultations held in Beijing on January 7-8 have attracted worldwide attention.
The working groups of both sides have stepped up their works since the Chinese and the US leaders met in Argentina in early December and reached a consensus. Since the beginning of the China-US trade disputes, the two sides have held many rounds of consultations at various levels but none of them made great success. The meeting in January is the first meeting after the Chinese and US leaders agreed not to add new tariffs on each other at the G20 summit. The outcome of the two-day consultation is crucial for paving the way for the forthcoming higher-level talks.
I believe that the China-U.S. economic and trade consultation can reach a mutually beneficial solution due to the following three reasons:
First of all, the two sides have a clearer understanding of their goals and they are more eager to reach a consensus than ever. The US side will not come up with unrealistic and difficult demands like it did before and it will adopt an objective, pragmatic and rational approach.
For the Chinese side, it will accelerate the pace of reform and opening up, increase intellectual property protection, further relax market access, increase imports from the United States, and create a transparent and fair business environment, so long as these will not jeopardize the core interests of China. Comparing with the previous negotiations, the two sides now have a more consistent foundation for consultations.
Secondly, the grim global economy and increasing uncertainties have greatly increased downward pressure facing the Chinese and US economies and hence, to promptly bring the two sides to a truce and enhance their confidence have become an urgent task. In the US, the effect of Trump’s tax cuts has gradually disappeared, the prospect of new industrial development is bleak, the China-U.S. trade frictions have brought significant negative impact on the three major stock markets, the middle class is pessimistic about future development and the protectionism of the US has reduced confidence of importers and consumers. Therefore, it is necessary to renew the confidence of the US market through a fruitful China-US trade negotiation. Right now, China has just started another 40 years’ reform and opening up, how to achieve a higher level of reform and opening up, how to conduct successful supply-side reform, achieve high-quality economic development and improve the quality of people’s living standards are the top priorities of China’s economic development.
Therefore, the two sides should take constructive measures to cease the trade war, create better conditions for new strategic cooperation in economic and trade field, so that both sides can achieve mutual benefits and win-win cooperation.
Thirdly, some foreign media and think tanks said that the delegates of the negotiating team are only vice-ministerial level and hence, this is only a working-level meeting, which can only reshape confidence and hope but no major breakthroughs should be expected. I disagree with them. On the contrary, I think that this working-level negotiation is of great importance because the result will not only pave the way for a higher level negotiation but more importantly, it will put forward positive suggestions on the reciprocity package between China and the US.
A good start is half done. We look forward to seeing positive and constructive results from this round of China-U.S. economic and trade consultation.