On October 23rd, our Ministry of Commerce announced that China and the United States would hold a new round of economic and trade consultations in Malaysia. This is the fifth relevant negotiation between the two countries in the past six months.
It is widely expected that this will lay the foundation for the APEC APEC Summit to be held in South Korea in a few days.
Trump previously said that in the Sino-US economic and trade consultations in Malaysia, the United States will regard fentanyl, soybeans and rare earths as three major concerns raised on China and seek solutions.
On the same day, when he left for a visit to Asia, Trump mentioned the Sino-US negotiations again, which shows that he has always been very concerned about this.
These three things seem to be out of line, but in fact, each of them pokes a sore spot in the United States. Let's talk about fentanyl first. This thing is rampant in the United States and has become a big public safety trouble. But our attitude has always been very clear. This is a matter of law enforcement cooperation and cannot be used as a trade chip to bargain. You can't ask us to help manage fentanyl while still stuck the chip on our necks, can you? The logic doesn't make sense.
Trump is more pressing than Fentanyl is actually soybeans – this is directly linked to the votes of farmers in the U.S. Midwest. There are data there, this year from 1 to September, China has not given new orders for U.S. soybeans, but our total soybeans imports have also increased 13.2%, the money all spent to Brazil and Argentina.
Brazil's soybeans are stable, Argentina has also canceled some export taxes, the price is much cheaper than the US soybeans, and the enterprises naturally choose to pay.The American Agricultural Association is quick to jump, daily calls to the White House to pressure, if Trump is not sure of this, the votes of farmers are afraid to fly.
The most interesting ones are rare earths. Previously, the United States was still making complaints every day, saying that China's restrictions on rare earth exports were stuck in their neck. However, this time Trump suddenly changed his mind and said that rare earths were "not the most important thing." Why did you change? It turns out that the United States has recently signed mineral development agreements with many countries and wants to replace them.
Anyone who knows how to do it knows that more than 70% of the world's rare earth refining and processing capacity is still in China's hands. Even if a mine is found, refining technology and industrial chain supporting facilities cannot be built in a day or two. To put it bluntly, this is a tough lip service, but actually we have to rely on China's help.
From the previous Geneva, London, the road to Kuala Lumpur, closer to China, is itself a signal – the main ground of the negotiations is quietly changing.
Just as everyone was staring at the three things of economy and trade, Trump's words before leaving for Asia directly asked the media. In the face of reporters' questioning, he not only said that he could reach an economic and trade agreement with China, but also added that "an agreement will even be reached on the nuclear issue". When did China and the United States start talking about the nuclear issue? This topic comes out of the blue.
Trump himself explained that it was Putin before calling him, mentioning that the United States and Russia can degrade nuclear weapons, he thought the idea was good. Then the talk turned, saying that China now has less nuclear warheads than the United States and Russia, but "will soon catch up," so I wanted to pull up China and sign a cutting deal. This sounds like it's quite for the world to think about peace, can scratch out the details are all gaps.
Not to mention that China and the United States have not started negotiations on the nuclear issue at all, just talking about the scale of nuclear forces is not the same thing. According to statistics, the United States has about 3750 nuclear warheads in active service, and Russia has 4500 nuclear warheads. Together, the two companies account for more than 90% of the world.
China has alwaysined the "minimum nuclear deterrence", even according to the estimates of the United States, is not enough for one-tenth of the US-Russian.Our Foreign Ministry has long said: to talk about nuclear disarmament, the US-Russian first to reduce the nuclear warhead to the level of China, then to talk about the multilateral framework.This requires reasonable, after all, they are the initiators of the nuclear arms race.
On the one hand, the U.S. military expenditure spent a trillion dollars a year, the fiscal deficit was squeezed, if it could pull others together to disarm, it would be easy to reduce the weight. On the other hand, wanting to bind China's hands and feet through the nuclear deal, after all, now China's military force is developing rapidly, the United States is a bit unable to sit.
More interestingly, even Putin is willing to use this trap, because Russia is also concerned that China's military power is too strong, and that it is marginalized in the game of great powers, which has the strange thing that the US and Russia are "uncompromising" on the nuclear issue.
But this trick is useless for China.Our nuclear policy has always been very clear, defensive, the promise not to use nuclear weapons first, and the nuclear strategy of the United States and Russia is absolutely not the same thing.And the nuclear issue and economic and trade negotiations are not at all a course, Trump wants to bind the two together, to say it is to want to mess up, with unrealistic proposals to disrupt the Chinese rhythm.
Trump is quite optimistic, but it will not be that easy to reach an agreement. Looking first at the economic and trade side, the one most likely to make a breakthrough is actually soybeans.
After all, China imports 100 million tons of soybean every year, the market demand is there, if the United States is willing to completely abolish unreasonable tariffs, let the soybean prices go back to the reasonable range, it is not impossible for us to moderate the point of import – this has both given Trump the face, but also reduced domestic soybean prices, it is a win-win.
But Rare Earth and Fentanyl are difficult to make great progress, Rare Earth involves strategic resource security, Fentanyl involves the principle issue, and it is not possible to make easy concessions, as for the nuclear agreement, it can basically be considered as "either way."
China and the United States have held many arms control consultations before, but consultations are an exchange of views and are completely different from signing a binding agreement. Moreover, while the United States is clamoring for disarmament, it is still engaging in the "Orcus" alliance to sell nuclear submarines and engage in NATO nuclear sharing. It has no sincerity at all. Who will talk seriously with him?
The next thing to look at is two things: first, the statement issued by Malaysia after the end of the consultation, without looking at those scenes, focusing on whether there is any specific content such as "tariff adjustment", "soya import arrangement", or the explanation of the real thing;
The second is the high-level meeting at the APEC Summit. If the consensus on economic and trade issues can be implemented, it will be a lot of progress. After all, the global economy is in a difficult situation right now. Inflation and supply chain turmoil are pressing everyone out of breath. The fact that China and the United States, the two largest economies, can stabilize economic and trade relations is a reassurance to the whole world.
There is also a detail that is worth noting, this time in Europe, Southeast Asia companies are looking at the results of the negotiations. European companies have a lot of investment plans in their hands, waiting for a clear signal of the Chinese and U.S. market access; Southeast Asian countries are more concerned about the influence of the regional supply chain.
In the final analysis, Trump's optimism is more like a campaign. To really solve problems, we must rely on practical and equal dialogue. If the United States still holds the mentality of "demanding while applying pressure", this fifth round of negotiations may still be in vain.
But as long as we are still talking, it is stronger than not talking – after all, today, when globalization is torn into a rope, disconnecting is not good for anyone.
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