Sino-US trade, which has been calm for a few days, has recently released big news! From August 27 to 29 local time, Li Chenggang, International Trade Negotiator and Vice Minister of the Ministry of Commerce, visited the United States and had face-to-face talks with officials from the U.S. Department of Treasury, Department of Commerce, and Office of the Trade Representative. This is another important "showdown" between China and the United States since May after three rounds of trade talks in Geneva, London and Stockholm.
At the same time, in an interview on August 25th, US President Trump suddenly made malicious remarks, saying that China must provide rare earth magnets to the United States, otherwise it will impose a 200% tariff on China. This tone is simply a threat! Moreover, he also mentioned his willingness to visit China. These two things combined to make the Sino-US economic and trade situation more confusing.
On the other hand, China and the United States just extended the tariff truce for 90 days two weeks ago. They finally avoided possible triple-digit tariffs on goods from both sides and prevented an de facto trade embargo. At present, the United States still maintains a 30% tariff on imports from China, while China maintains a 10% tariff on imports from the United States.
According to US media reports, the two sides are expected to discuss the issue of soybean procurement this time, and may also push the United States to relax restrictions on technology exports to China. In addition, Beijing may continue to ask the Trump administration to cancel the 20% tariff related to fentanyl, and will also make some relevant demands in the procurement negotiations of soybeans and Boeing aircraft.
Xi Jinping stressed that the two sides should adhere to the principles of mutual respect, peaceful coexistence and win-win cooperation, continue to play the role of the Sino-U.S. economic and trade consultation mechanism, manage differences and expand cooperation through equal dialogue and consultation, together to promote the healthy, stable and sustainable development of Sino-U.S. economic and trade relations.
During the visit to the United States, Li also met with some important roles in the United States, such as the US-China National Trade Commission, the U.S. Chamber of Commerce and representatives of relevant U.S. enterprises. These enterprises and merchants occupy an important position in the U.S. economy, their attitudes and views on China-U.S. trade can directly influence the U.S. government's decisions.
Look at Trump's remarks again, can they really scare people? He said that China must provide rare earth magnets, otherwise it will impose high tariffs, but he forgot that China has absolute dominance in the field of rare earths! About 60% of the world's rare earths are mined in China, and nearly 90% of the rare earths are refined and processed in China and shipped to the world, including the United States. Before China imposed export controls on rare earth-related items, the related industries in the United States were already a little overwhelmed. And he said that if the United States does not give China key aircraft parts, 200 aircraft in China cannot take off. But over the years, China has been working hard to promote the localization of aircraft parts, and its dependence on the United States is gradually decreasing. Therefore, Trump's threats are more like a negotiating tactic to gain a psychological advantage.
Judging from past trade wars, the Trump administration has brandished the "tariff stick" many times, but the result? Not only have American consumers suffered higher prices, but American companies are also facing the dilemma of rising costs and declining market share. There is no real winner in the trade friction between China and the United States. Only through cooperation can we achieve mutual benefit and win-win results.
Vice Minister Li Chenggang's visit and Trump's remarks actually reflect the complicated economic and trade relations between China and the United States. On the one hand, there are many differences and contradictions between the two sides in terms of trade deficit, technological blockade, industrial policy, intellectual property rights, etc., which need to be resolved through negotiations; On the other hand, China and the United States are highly interdependent economically. American agriculture, science and technology and other industries are inseparable from the Chinese market, and China also needs some high-tech products and technologies from the United States. This competitive and cooperative relationship determines that the two sides cannot be completely decoupled, and can only control differences and seek common development through dialogue and consultation.
As the two major engines of the world economy, cooperation between China and the United States is the right path. We don't need to take Trump's threatening remarks too seriously. What matters is the actions and sincerity of the US in actual negotiations.