In a recent interview with the Wall Street Journal, the newly installed US Trade Representative Katherine Tai indicated that the US doesn’t have plans to remove tariffs on Chinese products in the near future, while suggesting tariffs could be “leverage” in potential trade talks.
While Tai’s remarks on the tariffs largely mirror what the new US administration has stated, the signal from Washington’s top trade representative of its openness to potential trade talks stands out, as the two sides have not held high-level trade consultations since Joe Biden took office.
With the bruising tariffs war continuing to batter businesses on both sides and a litany of thorny issues remaining in the bilateral economic and trade relationship, it is definitely a welcome development for the US side to express their open attitude toward potential talks, which could not only help address those issues but also inject a much-needed sense of stability into rapidly deteriorating bilateral ties.
Economic and trade cooperation has been widely considered as the “ballast stone” for China-US relationship. With the growing tensions between China and the US on major political and security issues, it is more urgent than ever to improve trade cooperation. If the world’s two largest economies could actively work toward trade negotiations to resolve trade frictions and disputes, it will undoubtedly send out a positive signal for the future of bilateral relations.
However, it is still too early to be optimistic as to how the China-US trade issues will unfold and whether trade talks would take place any time soon. This is because in the same interview, Tai also suggested that the US tariffs could be used as “leverage” against China. “No negotiator walks away from leverage, right?” she said.
It’s regrettable to see some in the Biden administration still want to continue Donald Trump’s clumsy gimmick of welding the stick against China. As the Trump administration has learned, using tariffs as leverage against China won’t win Washington any concessions from China. Instead, it will only narrow the window of opportunity for the two sides to resolve lingering economic and trade issues.
During the Trump era, China went head-to-head with the US by launching countermeasures against US tariffs. The result is that China firmly stood on its ground and advanced its economic development, while the US did not gain anything but inflecting damages on its own businesses and economy.
Those damages have been well documented. A study commissioned by the US-China Business Council said in January that the trade war has caused a loss of up to 245,000 US jobs, but a gradual scaling back of tariffs on both sides would boost growth and result in 145,000 additional jobs. That is why calls for Biden to remove the tariffs have been growing within US business circles. Some 3,500 companies have even sued the US government over those tariffs.
But, against all that, the US’ top trade representative still suggests to keep those tariffs as leverage. That is not only irresponsible but also reflective of the faltering domestic support for Washington to continue the tariff war with Beijing.
On the Chinese side, officials have repeatedly called on the US to drop those tariffs and made clear China is open to dialogues that are based on equality and mutual respect. However, suggesting keeping tariffs on Chinese goods will by no means be mistaken as a sign of goodwill from the US. It would only add difficulty for any constructive communications between the two sides in the future.
Therefore, it is hoped that the Biden administration would heed the calls from business communities in the US and around the world and change its course when it comes to the issue of tariffs. That would create a favorable atmosphere for potential trade talks to address issues.
China-US Photo: GT
