Trade

What Does China Want From Trade Talks?

Written by SK Ashby

The Trump regime has been vague about what exactly they want from a trade deal with China, in part, I suspect, because Trump himself changes his mind on a weekly basis and does not actually understand how trade works.

For their part, Chinese Vice Premier Liu He clearly enunciated what they want from a deal and what they're asking for seems entirely reasonable to me.

From Bloomberg:

In a wide-ranging interview with Chinese media after talks in Washington ended Friday, Vice Premier Liu He said that in order to reach an agreement the U.S. must remove all extra tariffs, set targets for Chinese purchases of goods in line with real demand, and ensure that the text of the deal is “balanced” to ensure the “dignity” of both nations. [...]

Liu also struck a note of defiance. “For the interest of the people of China, the people of U.S. and the the people of the whole world, we will deal with this rationally,” the vice premier said. “But China is not afraid, nor are the Chinese people,” adding that “China needs a cooperative agreement with equality and dignity.”

It's reasonable to expect the other side to roll back the tariffs they imposed at the beginning of negotiations in a deal to resolve those negotiations.

It's reasonable to ask China to a purchase what they need to meet consumer demand, not purchase more than what they actually need just for vanity's sake.

It's reasonable to expect a deal with be beneficial for both sides by some measure, thus ensuring "dignity" for both sides.

Out of these demands, I expect the latter is the most difficult for Trump to process or agree to. Trump's idea of a "deal" is he gets everything and you get nothing. Trump does not make "deals" and he never has in this entire life. What Trump has categorically described as "deals" are just financial swindles and schemes that he has used throughout his life to screw every business partner he's ever had.

The Chinese government are not gullible bankers, glorified loan sharks, or desperate contractors. They are not the people Trump is known for making "deals" with. I suspect Trump's inability to make real deals is why Premier Liu He said a deal must be balanced to ensure "dignity." Trump wants them to bend over and take it.

We can't sit here and say the Trump regime will never reach a substantive deal with China, but it sure seems unlikely as hell, doesn't it? It's hard to see this ending until Trump is out of office.