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US farmers, industry urge Trump to resolve China trade dispute quickly
WASHINGTON, May 8, 2019 (BSS/AFP) – US soy farmers and industry on Tuesday
urged President Donald Trump to pull back from his tariff threat and quickly
bring an end to the trade dispute with China.
That message was reinforced by financial markets, as US stocks fell by
more than two percent for the first time in months amid concerns the renewed
trade tensions could scuttle a deal.
Trump has vowed to more than double the tariffs on $200 billion in Chinese
goods starting Friday, after US negotiators accused Beijing of reneging on
commitments made during months of talks that aim to reduce the US trade
deficit, clamp down on theft of US technology and reduce China’s massive
subsidies.
American soy farmers have found themselves in the crosshairs of Chinese
retaliation, and prolonging the battle will be even more damaging, Davie
Stephens president of the American Soybean Association (ASA), said in a
statement.
Stephens, a grower from Clinton, Kentucky, said “farmers are in a
desperate situation. We need a positive resolution of this ongoing tariff
dispute, not further escalation of tensions.”
China is a key market for US soy bean exports, but last year sales plunged
by about 75 percent compared to 2017 to just over $3 billion, after China
retaliated against US farmers with 25 percent tariffs.
Stephens said prices already are depressed, so “we need the China market
reopened to US soybean exports within weeks, not months or longer,” and
before the 2019 harvest begins in September.
“The financial and emotional toll on US soybean farmers cannot be
ignored.”
The chemical industry is facing similar difficulties, and also called for
the White House to work fast.
“The risks of continuing to use tariffs as a negotiating tactic with China
are simply too high — and any potential benefits still unclear,” American
Chemistry Council President Cal Dooley said in a statement.
“China supplies the United States with several chemicals which are not
available anywhere else and which are critical inputs to US manufacturing,”
he said, noting that China is also is the number three US export market.
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US-CHINA-TRADE-DISPUTE-TARIFF 2 LAST WASHINGTON
– Talks will go on –
Despite the tougher US rhetoric, China said Tuesday its top trade
negotiator, Vice Premier Liu He, would lead Beijing’s delegation to the talks
in Washington on Thursday and Friday, a day later than originally scheduled.
“China always believes that mutual respect, equality and mutual benefit
are the premise and the basis for reaching an agreement. Adding tariffs will
not solve any problem,” Chinese Foreign Ministry spokesman Geng Shuang said
at a regular media briefing.
Trump’s new tariff announcements have tanked stock markets worldwide as
investors, like worried US farmers and businesses, had been banking on a
resolution to the year-long conflict that has engulfed $360 billion in two-
way trade.
Markets slumped even further on Tuesday, and Wall Street, which had been
less pessimistic, fell more than two percent in afternoon trading.
US officials say the world’s two largest economies had been close to an
agreement but they claim Beijing reversed course in recent days.
“Over the course of the last week or so, we’ve seen an erosion in
commitments by China, I would say, retreating from commitments that have
already been made in our judgment,” US Trade Representative Robert Lighthizer
was quoted as saying in media reports on Monday.
He said the tariffs would increase at 12:01 am (0401 GMT) on Friday.
Treasury Secretary Steven Mnuchin described the negotiations as 90 percent
complete but told reporters that in recent days the talks had gone
“substantially backward,” according to the media reports.
Trump vowed Sunday to ratchet up existing tariffs this week and also to
extend the 25 percent punitive duties to the remaining $350 billion in
Chinese goods imported into the country each year.
– Growth fears –
The tensions have renewed fears that the trade war could spill over into
the global economy.
Speaking in Paris, International Monetary Fund chief Christine Lagarde
said “tensions between the United States and China are the threat for the
world economy.”
Oxford Economics warned that escalating the tariffs to the remaining
Chinese goods, which would be expected to spark further retaliation from
Beijing, would cut 0.3 percentage points off US growth.
But William Reinsch, a trade policy expert at the Center for Strategic and
International Studies, cautioned that China will never meet all the US
demands, which complicates Trump’s strategy.
“The most important things are the things the Chinese won’t give,” he told
AFP, including reducing subsidies and subjecting state-owned enterprises to
market forces.
“The Chinese are not going to do either of those things,” so “the path to
political victory for him is a narrow one,” he said.
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