China Vows to Protect Its Interests From 'Reckless' US Trade Threats

Leah Millis  Reuters

But U.S. companies pocketing profits in China are often ignored, and they could become China's tool to retaliate if the trade war ever comes true.

If the United States implements trade sanctions including tariffs then all outcomes of the China-US trade talks will be void, state news agency Xinhua reports following high-level trade discussions in Beijing. The list will include $50 billion of imports that will face a 25 percent tariff.

According to a ministry spokesman, Gao Feng, the White House proposal to restrict Chinese investment in the United States violates the "rules and basic spirit" of the World Trade Organization. And doubts remain about whether China will address allegations the Chinese engage in cybertheft of trade secrets, force USA companies to transfer some of their technology in exchange for market access or back away from its China 2025 plan to dominate emerging technologies.

If the two sides fail to reach an agreement and the USA moves forward with tariffs, Chinese officials have said they plan to retaliate with tariffs of their own on USA exports such as soybeans.

The move, which is meant to combat the supposed theft of US intellectual property, will take effect on June 11. The Commerce Ministry didn't respond to questions about the status of the meeting, but the American Embassy said a delegation of trade, agriculture and treasury officials had arrived in the Chinese capital to make preparations.

Citing a document issued by the Trump administration in December, the official said the USA government would consider restrictions on visas for science and technology students from some countries. Argentina, Australia, Brazil and South Korea all came to the negotiating table, while European Union officials said they would not negotiate trade issues "at gunpoint".

Over 1.65 lakh Indian students enrolled in US universities in 2016.

In return, the Commerce Department lifted a seven-year ban on ZTE's purchase of USA components that it imposed earlier in May.

The tariff threat is a "very powerful" negotiating tactic, said Lester Ross, chairman of the American chamber's policy committee. The ban, imposed this month, threatened to put ZTE out of business.

On Friday, China's markets regulator said it was still reviewing San Diego-based Qualcomm Inc.'s (Nasdaq: QCOM) $44 billion acquisition of NXP Semiconductors (Nasdaq: NXPI).

"I think he's gotten a fair amount of criticism from Congress and from the press and he seems to have hardened his attitude toward China in response to that", Dollar said.

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