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​China and USA Trade Talks End in Failure

​China and USA Trade Talks End in Failure

Scheduled press conferences were cancelled

Anonymous

Anonymous

An ongoing barrier between the China and America on a potential trade agreement continues without a deal being reached. Talks between the two superpowers had been taking place, with hopes that some deals could be made despite stark differences between the two countries. However, the talks ended without a satisfactory outcome for either party, or a joint statement or plan of action. Meetings and scheduled press conferences were also cancelled.

One of the possible reasons for the outcome was America's critical stance with regards to China's trade surplus, which stands at £266 billion (£205bn). The US argues that the surplus was not achieved through market forces.

Donald Trump
Donald Trump

Credit: PA

The US has a huge trade deficit with China. Its exports there were worth $116bn (£89.4bn), while imports from China were $463bn (£357bn). Primarily, the US imports consumer electronics, clothes and machinery while China's imports are mainly raw materials sent to the country for low-cost assembly.

Though disputed, most economists agree that China is able to produce costs at a very low price (which US consumers demand in high volume) due to its lower standard of living and its exchange rate, which is in part fixed to the dollar.

Xi Jinping
Xi Jinping

Credit: PA

Though President Trump and Xi Jinping (General Secretary of the Communist Party and China's leader) have enjoyed a positive public relationship, the American Head of State was very critical of China during his ultimately successful election campaign in 2016, in which he regularly labelled the country as an enemy of the US and claimed it was responsible for the loss of US jobs.

Trump's famous 'Make America Great Again' hats were ironically made in China, but his election rhetoric went down well with supporters and may have contributed to his victory in November 2016.

As talks ended, the USA criticised China's surplus, demanding 'more fair' trade arrangements, while the President suggested tariffs on Chinese imports still might still come to pass (a threat he has made both before his election and since.)

US Treasury Secretary Steven Mnuchin made a brief statement outlining the points of contention between the two countries.

"China acknowledged our shared objective to reduce the trade deficit which both sides will work cooperatively to achieve," the statement said.

Donald Trump
Donald Trump

Steel was one of the key issues in the failed talks, with the US claiming that China's ability to produce a global steel glut (over the past 25 years, its steel output has grown more than 12-fold) is harming US producers. China's huge economic growth in recent decades has led to a rise in domestic and international demand, but since the economic crisis demand internationally has fallen, leaving the country with vast amounts of steel to sell at very low prices.

Aside from steel, the Chinese had been expected to bring up the US's refusal to sell Beijing advanced technology products during the talks, while the US was expected to bring up North Korea's nuclear and missile programmes during talks, though it was unclear whether or not this happened.

One deal that was struck, however, was the removal of a ban on Chinese imports of US beef and liquefied natural gas.

Sources: BBC, The Balance, ABC

Words: Ronan O'Shea

Featured Image Credit: PA

Topics: Donald Trump, China