President Xi Jinping of China suggested that China would make the Chinese market more accessible to U.S. imports after weeks of tough talk from U.S. President Donald Trump.
Mr Xi said Beijing will “significantly lower” tariffs on car imports this year and ease restrictions on foreign ownership in the car industry “as soon as possible”.
He also promised to expand protection of intellectual property – an issue high on the list of US demands – as he ushered in a “new phase of opening up” during the Boao Forum for Asia, his country’s answer to Davos.
Xi appears to be directly responding to President Trump’s two most public complaints: Chinese tariffs on U.S. cars and the theft of U.S. companies’ intellectual property.
When a car is sent to the United States from China, there is a Tariff to be paid of 2 1/2%. When a car is sent to China from the United States, there is a Tariff to be paid of 25%. Does that sound like free or fair trade. No, it sounds like STUPID TRADE – going on for years!
— Donald J. Trump (@realDonaldTrump) April 9, 2018
President Xi and I will always be friends, no matter what happens with our dispute on trade. China will take down its Trade Barriers because it is the right thing to do. Taxes will become Reciprocal & a deal will be made on Intellectual Property. Great future for both countries!
— Donald J. Trump (@realDonaldTrump) April 8, 2018
We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!
— Donald J. Trump (@realDonaldTrump) April 4, 2018
Some experts don’t really see President Jinping’s remarks as a real change.
“President Xi’s remarks do not represent a dramatic departure from existing Chinese policy, but rather a reiteration of the same themes Xi has promoted throughout his tenure atop China’s policy making system,” said Chaoping Zhu, global market strategist at JP Morgan Asset Management.
If China drops it’s auto tariffs to meet the U.S. 2.5% level, it would a dramatic reduction from the current 25% level.
China’s commitment to protecting foreign intellectual property has been heard before and little has been done. It remains to be seen if Xi’s newest overture accomplishes anything substantial.