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Trade Trouble Looms Over China Development Forum

25 Mar 2018 12:41 pm
By Yoko Kubota 

BEIJING--An annual global economic forum sponsored by the Chinese government has become an ad hoc stage for trade jockeying between the U.S. and China, with rising tensions over tariffs coloring the public sessions.

Senior Chinese government officials took the spotlight Sunday at the China Development Forum, contending that the Trump administration's tariffs on Chinese imports will hurt both nations.

"If one goes against tide [of economic globalization] and resorts to trade protectionism, then the problems won't be solved," Vice Premier Han Zheng said in a speech at the Diaoyutai State Guesthouse. "Unilateralism [and] the trade war, serve the interests of none. It would only lead to serious consequences and negative impact," he said, without mentioning the U.S. by name.

Mr. Han's comments were among the first made in person by a Chinese official after the U.S. last week proposed tariffs on as much as $60 billion of Chinese products and tighter restrictions on acquisitions and technology transfers.

A separate, previously announced round of U.S. tariffs on Chinese steel and aluminum products took effect Friday. The U.S. on Friday also lodged a dispute at the World Trade Organization against China's technology licensing practices, which the Trump administration says favor Chinese companies. China responded with plans to impose tariffs on $3 billion of U.S. goods.

Vice Commerce Minister Wang Shouwen said on Sunday that the U.S.'s move to slap tariffs on metals violated WTO rules.

Mr. Wang said China was a relatively small source of steel for the U.S. and that it wouldn't pose a threat to U.S. national security, as U.S. President Donald Trump has claimed.

"China's interests have been damaged. We need to defend our interests in accordance with the rules of WTO," he said at a panel discussion, adding that he hopes the two countries can sit down and negotiate to resolve the trade dispute.

U.S. officials have said Chinese global overcapacity is swamping steel and aluminum markets, and that Chinese exporters often ship products to third countries that then sell them to the U.S.

Should the trade tension escalate and hit financial markets, China would be resilient, the new governor of China's central bank told a panel.

"I think [with] the current banking, insurance and securities markets in China, as well as the controls of variables including the quantities and prices, we're in an absolutely good position to prevent and mitigate these risks," said Yi Gang, the governor of the People's Bank of China.

The timing of the event places executives of U.S. companies in an awkward position. Some from those companies have been quiet on the issue when approached by media, declining to comment when asked about how the brewing trade tension could impact their businesses.

Apple Inc.'s Chief Executive Tim Cook, who is co-chairing the event, was among the few who touched on the issue publicly in forums so far, calling for open trade.

"Our collective business community fuels national economic engines across the globe, and the resulting growth is a constant reminder that when people, companies and governments work together, we all benefit," he said in a speech on Sunday.

Chief executives from International Business Machine Corp., Qualcomm Inc. and BlackRock Inc. are also among those attending the event.

The forum ends Monday. A meeting between top U.S. and other foreign executives and Chinese Premier Li Keqiang is scheduled that day. A smaller group of executives in Beijing for the forum is set to meet with Vice President Wang Qishan on Tuesday, people familiar with the matter said.

Yang Jie contributed to this article.

Write to Yoko Kubota at yoko.kubota@wsj.com
 

(END) Dow Jones Newswires

March 25, 2018 08:41 ET (12:41 GMT)

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