China’s premier seeks to allay fears over global trade war

Li says foreign firms will compete on equal footing

BEIJING: China’s Premier Li Keqiang (C) speaks as attendants top up his glass during a press conference after the closing session of the National People’s Congress in the Great Hall of the People in Beijing yesterday. —AFP

BEIJING: Voicing hopes that Beijing and the United States could avoid a trade war, Premier Li Keqiang told the close of the annual parliament session that China would open its economy further, so that foreign and Chinese firms can compete on an equal footing.

Fears of a global trade war mounted after US President Donald Trump’s imposed hefty import tariffs on steel and aluminum earlier this month and, according to sources in Washington, the United States is set to unveil new tariffs specifically targeting China by the end of this week.

“I hope both China and the US will act rationally, and not be led by emotions, and avoid a trade war,” Li told reporters in a televised news conference at the Great Hall of the People in Beijing.

Those hopes would be damaged if, as sources say, Washington goes ahead with plans for new tariffs on up to $60 billion worth of Chinese technology and consumer goods annually, in a move to fulfil Trump’s campaign promises to get tough on China and its trade practices.

Without going into detail, Li told his once a year press conference that China will improve access to its services and manufacturing sectors while further lowering import tariffs, including those on cancer-related drugs.
“China’s economy has been so integrated with the world’s, that closing China’s door would mean blocking our way for development,” Li said.

“China’s aim is to ensure that both domestic and foreign firms, and companies under all kinds of ownership structure, will be able to compete on fair terms in China’s large market.”

Trade tensions
When Xi’s top economic adviser Liu He visited Washington recently, the Trump administration pressed him to find ways to reduce China’s $375 billion trade surplus with the United States. “We are unwilling to see a big trade deficit, not only with the US,” Li said. “We hope trade will be balanced.”

In his remarks, Li said that as China widens access to its markets, there will be no forced transfers of technology, and China will better protect intellectual property rights.

Trump says Beijing has forced US companies to transfer their intellectual property to China as a cost of doing business there, though China has insisted that technology transfers are not a condition of gaining market access.

A source who had direct knowledge of the Trump administration’s thinking told Reuters last week that the tariffs expected to be announced this week would chiefly target information technology, consumer electronics and telecoms and other products benefiting from US intellectual property.

But they could be much broader and hit consumer products such as clothing and footwear, with a list eventually running to 100 products, this source said.

“We hope the US could ease restrictions on high-tech or high value-added product exports,” Li said. “We will strictly protect intellectual property. We hope this important means for balancing China-US trade will not be missed, otherwise we will lose a chance to make money.”

Economic targets
Before the press conference, Li introduced China’s four new vice premiers, including Liu He, widely regarded as China’s new economic tsar. But adhering to protocol, it was the premier who did all the talking. Li said China was confident of achieving its 2018 economic targets. The government aims to expand its economy by around 6.5 percent this year, having easily surpassed the same target in 2017.

China’s financial sector was in good shape and banks have enough provisions, Li said, adding that regulators would take “resolute measures” to tackle financial risks.

The Chinese central bank was being given responsibility for drafting important laws covering the banking and insurance sector, with regulation over the $42 trillion sector becoming more streamlined and tighter. And Li said he was willing to consider a formal visit to Japan, amid signs of improving ties between the two nations.-Reuters

Back to top button