China Press Review – May 24, 2019

Press review

Trump-Xi trade war summit at G20 in Japan still up in the air as ‘conditions not right’, China adviser says
China’s president met his US counterpart in December in Argentina during a G20 summit which led to a three-month tariff truce which was then extended The United States has since raised tariffs on US$200 billion of Chinese imports and threatened to impose sanctions on a further US$300 billion

The Trade War Will Backfire On The American Economy
The United States was at the end of a business cycle with underlying economic indicators weakening. Over a thousand economists wrote to the president, urging against protectionist measures. Stocks swung up and down on any news of the potential implementation of tariffs. Do the above statements describe 1930 or 2019? Both. Look for backfire effects from the tariffs in the American economy, even in industries that ostensibly benefit from them.

On Trade, Trump Should Look to Japan in the 1970s
Aliber says that Trump is correct to take a strong stand, but may be using the wrong tactics by imposing 25% tariffs on $250 billion in Chinese exports to the U.S, and threatening to do the same with the remaining $350 billion if China retaliates. “I’ve only seen tariffs work to create freer trade in one case,” says Aliber. “That was in 1971, when the U.S. imposed duties to force Japan to allow the yen to float, and therefore increase its price.” But the policy of pressing China to reform on multiple fronts requires agreement on so many individual points that a final agreement may be unreachable. “I prefer the approach that Treasury Secretary John Connolly took with the Japanese in the early 1970s,” says Aliber. “He said, ‘We want you to buy a lot more U.S. goods. But you can do it through government purchases or any other mechanism. The instrument is up to you.’” For Aliber, the best approach is to let China decide which of the protectionist measures its leaders want to dismantle, but stick to the goal of shrinking that yawning, $400 billion-plus trade deficit in the interests of bolstering U.S. manufacturing.

Former JC Penney CEO: China trade deal needed by end of year or retail’s ‘got a real problem’
The U.S. needs to work out a trade deal with China by the end of the year or the retail sector will be in big trouble, former J.C. Penney CEO Allen Questrom says. “If the tariffs don’t get solved this year then you’ve got a real problem,” he says.

Trump’s China Syndrome – Five Things to Know Before Guessing About a DealMay 24th, 2019 3 min read
Figuring out what Trump is up to is a big deal. It’s a big deal for American companies trying to decide how to align their future supply chains. The White House knows it’s riding a geo-political roller coaster. So should we. We shouldn’t bet the house on anyone’s ability to connect dots. Zigs when we expect zags should surprise no one.

Consumers are ‘unequivocally the losers’ in US-China trade war, says IMF
Research from the International Monetary Fund finds that US importers ‘almost entirely’ bear the cost of tariffs, which are then passed on to the consumer Latest round of tariffs contains goods which are not easily substituted by imports from other markets, which analysts say will further hit consumers

Donald Trump says Huawei could ‘possibly be included’ in deal to end trade war
The US president called the Chinese telecoms giant ‘very dangerous’ Washington placed Huawei on a blacklist last week, and the company faces multiple indictments over alleged economic espionage

China denounces US’ Mike Pompeo for ‘rumours’ about Huawei links to Beijing
Washington has never produced clear evidence, Chinese Foreign Ministry says US Secretary of State said telecoms maker was lying about ties to Chinese government

Trade battles and big power competition—more pain for the tech industry

After a lull, the trade war is back on. From new moves to lock Huawei out of the US to tightening visa regulations for Chinese nationals, from new tariffs to new Trump tweets, both China and the US are ramping up for another battle after the March cease-fire. While many are still crossing their fingers in hopes of a quick resolution, leadership in both countries show no signs of backing down.

INSIGHTS: Trade battles and big power competition—more pain for the tech industry

The Forever Trade War
America’s contest with China is only beginning. America’s relationship with China has taken a turn toward the confrontational. Tariffs are rising, rhetoric is heating up, and both sides are digging in. For all the efforts at a resolution, this current phase will likely be remembered as merely the opening skirmish in a long-term competition. The China contest now represents a key organizing principle of American foreign policy. Even a successful trade agreement would represent only the end of the beginning in a new era.

Does China Really Respect Sovereignty?
Both Washington and Beijing claim to champion sovereignty – they just have different ideas of what that looks like.

podcast : How much damage is the US-China trade spat causing?
The executive director of the International Trade Centre, Arancha Gonzales, shares her views on how the ongoing row between the two largest economies is affecting global trade flows and investments.

Sieren’s China: Donald Trump’s Huawei firewall

China’s IT companies have only been able to grow so fast because their US rivals weren’t allowed a look in. DW’s Frank Sieren writes that Donald Trump’s Huawei ban is an understandable, but shortsighted, response.

Technology is true target of US attack on China, says diplomat
Chinese ambassador to Britain joins chorus of criticism of US ‘economic bullying’ Accuses Washington of ulterior motive behind trade war

China’s tech ‘Long March’ could be road to nowhere
China’s president has called for technological self-reliance in the escalating rivalry with America, but experts believe Beijing’s late start on tech and relatively backward capabilities could make that a mission impossible.

Microsoft pulls Huawei products from Azure Stack cloud server catalogue
Chinese telecoms giant is one of several hardware vendors that make servers and equipment for the product Microsoft still not revealing whether it will rescind Huawei’s licence to use Windows operating system

To win US credibility, Huawei needs to be transparent and show that it is not China’s mini-me
As a global corporation, Huawei’s opacity about its ownership and governance is earning it discredit. Even its ferocious work ethic is coming under scrutiny as a ‘sacrifice’ its foreign rivals would not have allowed

How China can shrug off the impact of the US trade war on its economy and improve the lives of its citizens
China can stomach the cost to its GDP of even all its exports to the US being halted if it takes steps to boost domestic demand
Investment in public goods such as environmental protection, education and health care could serve this purpose

HSBC helps China’s manufacturers expand their production lines in Southeast Asia to dodge trade war tariffs
A growing number of manufacturers are looking to extend existing capacity in Malaysia, Thailand, Vietnam and India, says HSBC’s head of Greater China

Who’s Winning the Trade War?
Here’s a Look at the Scoreboard

US unveils US$16 billion in new aid for farmers burned by trade war with China
Bulk of funds will be spent on direct payments to farmers producing wide range of crops and livestock US Agriculture Department will also buy US$1.4 billion worth of surplus commodities and invest US$100 million in programmes promoting US farm products overseas

Some farmers reject Trump’s $16 billion bailout; Call it ‘poor remedy for trade’
President Donald Trump announced Thursday a $16 billion bailout for farmers affected by his ongoing trade war with China, but some large farm groups said these subsidies are merely a Band-Aid and will not help to fix the underlying problem.

Donald Trump planning more restrictions on US tech exports to China as trade war friction continues
Commerce Department expected to roll back rules making it easier for US companies to export goods that have both civilian and military purposes It may also end policy of approving export licences for such goods if they go to civilian use and instead require reviews on case-by-case basis

Microsoft said to stop accepting new orders from Huawei as it moves to comply with US restrictions
The US last week placed Huawei and its affiliates on a trade blacklist that restricted the Shenzhen-based firm from buying services and parts from US companies

Even a trade war deal with the US won’t be a cure-all for China’s economy and stock market
A close look at the Shanghai benchmark index reveals investors were already less bullish before the latest trade war flare-up. Chinese investor sentiment is also closely linked to whether the central bank will take further stimulus measures

Iflytek shares plunge as Trump targets more Chinese tech firms
Shares of Shenzhen-listed voice recognition firm Iflytek plunged by nearly 10% after news broke that the US is considering curbs on the company, along with several other Chinese tech companies, following Washington’s Huawei offensive. Also facing scrutiny are artificial intelligence company Megvii, data firm Meiya, and security camera makers Hikvision and Dahua.

Briefing: Iflytek shares plunge as Trump targets more Chinese tech firms

Chinese drone maker DJI monitors US blacklist as it develops own tech
A US warning on the security risks of Chinese-made drones has raised the spectre of DJI being placed under a trade ban

Chinese AI firms hunker down as reports indicate they are next on US export hit list
In November 2017 iFlytek was hand-picked by Beijing as a member of China’s national artificial intelligence ‘team’

B2B opportunities shore up slowing growth in consumer-facing verticals
“The rising shift to the B2B (business-to-business) market is a ‘win-win-win’ especially in China, for government, internet giants, as well as startup companies,” François Candelon, senior partner of Boston Consulting Group (BCG) said Thursday at the Emerge by TechNode conference in Shanghai.

B2B opportunities shore up slowing growth in consumer-facing verticals

Blockchain and its role in China’s future financial system
Two years ago, the Chinese government issued a sweeping crackdown on cryptocurrencies and initial coin offerings (ICOs), which has shifted the trajectory of blockchain development in China.

Blockchain and its role in China’s future financial system

China to end government subsidies for onshore wind power generation projects by 2021, state planning agency says
China to cut subsidies to zero as development costs fall Solar sector likely to follow soon, industry executive said

China aims to relocate 80% of toxic chemical producers after blast: report
China aims to relocate more than 80% of its hazardous chemical production capacity by the end of next year, state media reported on Friday, as it embarks on far-reaching reforms in the sector following a fatal explosion at a factory in March.

Will China help countries unlock the circular economy?
A new report shows that China can help developing countries meet the challenges of sustainable growth, writes Sam Geall

US takes aim at China’s growing influence with US$750 billion defence bill
Proposal seeks to stem erosion of US military advantage against Beijing and would authorise purchase of more F-35s and fund modernisation of US nuclear arsenal Senate panel that unveiled draft bill says US is ‘undermined by new threats from strategic competitors like China and Russia’

Will China’s 600km/h maglev train bring air travellers down to earth?
Unveiled in Shandong, prototype will be a first step towards ground-breaking high-speed travel that will rival passenger jets, project engineer says

The great protein shake-up: start-up creates lab-grown fish – without the bones – for 3D printing
Following the success of Impossible Foods and Beyond Meat’s plant-based burgers, BlueNalu is working on lab-grown fish meat Its products will be made from fish cells that are grown in plant broth, then formed with a 3D printer

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