Frosty US ties with China worry firms

Chinese workers push a cart loaded with fire extinguishers past a bench painted with the American flag outside a fashion boutique selling US brand clothing at the capital city's popular shopping mall in Beijing. [AP]

American companies want President Donald Trump’s negotiations with Beijing to win them real improvements in their access to Chinese markets, not just a smaller overall US trade deficit, a business group said Tuesday.

Companies that responded to a questionnaire last week want an end to Chinese pressure to hand over technology, unequal enforcement of laws and other chronic problems, said Tim Stratford, chairman of the American Chamber of Commerce in China. If not, he said, their losses in a tariff war “will be a tremendous waste.”

The comments appear to reflect support for US officials, including Trade Representative Robert Lighthizer, who want changes in industrial policy that Beijing’s trading partners say violate its free-trade obligations. Others Trump might accept less in return for China narrowing its politically volatile trade surplus with the United States through higher purchases of soybeans and other exports.

“If we don’t address the underlying structural issues, we will have continued trade frictions,” Stratford said in an interview.

Trump’s dramatic decision in July to hike duties on Chinese imports split the US business world. Some companies support the move to force Beijing into negotiations while others complain the tariffs are too costly and disruptive.

Among 150 companies that responded to a questionnaire last week, 43 per cent want to keep Trump’s punitive tariffs of 10 percent on $200 billion (Sh20.2 trillion) of Chinese goods in place while negotiations go ahead, Stratford said. He said nearly 10 percent want Trump to go ahead with a planned March 1 increase to 25 per cent. Trump announced Sunday he would postpone the March 1 increase after weekend talks made “significant progress.” He set no new date.

Both governments said they made progress on technology transfer, protection of intellectual property rights and non-tariff barriers to market access but gave no details.

Companies that responded to last week’s questionnaire said they want guarantees Chinese anti-monopoly and other laws will be enforced equally against them and local competitors, according to Stratford.