Chinese ambassador to US Cui Tiankai rebuts Trump administration's trade accusations

Chinese Ambassador to the United States Cui Tiankai said the United States' trade deficit with China does not mean it is "losing".
Chinese Ambassador to the United States Cui Tiankai said the United States' trade deficit with China does not mean it is "losing". PHOTO: REUTERS

WASHINGTON (XINHUA) - Chinese Ambassador to the United States Cui Tiankai has rebutted accusations by the Trump administration against China on trade, noting that only consultations based on mutual respect and trust will lead to a proper settlement of their current dilemma.

Mr Cui made the remarks in an article published on Wednesday (July 19) in the daily USA Today amid trade tensions between the United States and China and other economies. The Trump administration has utilised tariff tools against Chinese goods worth tens of billions of US dollars.

Mr Cui said the United States' trade deficit with China does not mean it is "losing". Rather, "thanks to the trade with China, American families have access to more, higher quality, lower cost products", Mr Cui said.

"In just 2015, trade with China lowered prices in the US by up to 1.5 per cent, saving each family US$850 (S$1,165) on average," he said.

Noting that "deficits are not products of ill-intention, nor are they necessarily bad for an economy", he added that China has never deliberately sought a trade surplus with the United States.

The surplus, at the centre of US arguments against China, was not produced intentionally, since "the flow of trade is determined by the market", Mr Cui said.

"Generally, they result from how resources are allocated in a globalised economy and are natural reflections of the global value chain," he said.


"Besides some structural reasons, such as the low-savings and high-consumption rates America maintains, the role of the US dollar as the international reserve currency inevitably leads to trade deficits," he said.

Also, "the fact that the US government curbs high-tech exports to China makes the deficit even bigger", Mr Cui said.

Another issue of concern of Washington regarding the US-China trade is about intellectual property rights.

Stressing that the US arguments against China's behaviour are wrong, Mr Cui said: "Chinese economic success has never been achieved by stealing from anyone, and never will be."

China is "strategically committed to and has recently made demonstrably significant strides" in intellectual property rights protection (IPR), Mr Cui said.

"We have codified a robust IPR protection legal system, including setting up IPR courts and dedicated tribunals that enhance the dominant role of the judiciary in IPR protection," he said.

Mr Cui added: "Since entering the World Trade Organisation in 2001, intellectual property royalties paid by China to foreign right holders has registered an annual growth of 17 per cent, reaching US$28.6 billion in 2017. More than US$7 billion (25 per cent) went to the US.

"Indeed, improving IPR protection is crucial to China's own development, particularly technological innovation."

The Chinese diplomat also rebutted US accusations of so-called "forced technology transfers".

He said: "Let's be clear: the Chinese government has never made any such request to foreign companies. When it comes to technology or any other cooperation between Chinese and foreign companies, it is purely a matter of voluntary contracts.

"Indeed, many foreign companies have reaped huge benefits from setting up joint ventures in China over the years."

The structural problems of China's economy are also a source of American criticism. However, this is "neither fair nor objective", Mr Cui said.

As for US accusations against the legal basis of China's counter-measures, Mr Cui said such remarks are no more than "a thief crying 'stop, thief'".

He said: "Domestically, the 301 investigation runs counter to the US President's Statement of Administrative Action approved by Congress; internationally, it has violated its commitment made in the resolution of the General Agreement on Tariffs and Trade dispute with the European Community in 1998."

Despite China's "maximum sincerity and patience" in trade talks, "unfortunately, the US has betrayed its own words", Mr Cui said.

"From February to June of this year, China... engaged in four rounds of high-level economic talks with the US. As a result, the China-US joint statement has been announced with consensus reached on strengthening trade and economic cooperation, and avoiding a trade war," he said.

However, Washington "brazenly abandoned bilateral consensus and insisted on fighting a trade war with China, forcing us to take counter-measures", said Mr Cui.

He noted that China will not yield to the Trump administration's trade bullying.

Moreover, major steps have already been delivered in China to promote its reform and opening-up recently, he said.

"Tariffs on 1,500 types of consumer goods have been lowered considerably. The import tariff on automobiles has been cut from 25 per cent to 15 per cent. The revised negative list for foreign investment released late last month substantially eased market access restrictions for foreign investors. In November, China will host our first International Import Expo in Shanghai," he said.

"With all of this as a backdrop, it is absolutely beyond our understanding that the US government initiated the trade war with such determination," said the Chinese diplomat. "Does the US government genuinely believe China would possibly yield to such unreasonable policy?"

He added: "Anyone familiar with Chinese history knows that 'maximum pressure' doesn't work for our nation.

"Trade bullying will only backfire. There is no winner in a trade war. The US will only end up hurting itself and the world."

China's policy has long been geared towards dialogue and consultation when trying to resolve trade disputes, the diplomat said.

"To be sure, there is room for China to improve its trade policy and address structural economic issues. We certainly are open to addressing reasonable American concerns," he said. "But the two sides should conduct dialogue and cooperation on the basis of mutual respect and trust."

He added: "For great powers like China and the US, competition - even conflict - is natural. It is, however, vital for us to manage such competition in an effective and constructive way."