WASHINGTON – May 8, 2019 – In a major development in the U.S-China trade war which previously showed signs of coming to an end, Washington received a draft trade agreement from Beijing in which the Chinese government has rejected almost all tentative agreements previously reached during the negotiations between the states.
It appears that the breaking point for China were accusations from the American side that China was engaged in an open policy of stealing intellectual property and trade secrets, as well as currency manipulation.
According to Reuters, referring to sources in the US government, each of the seven chapters of the draft trade agreement between the United States and China, which came into the hands of the American authorities, consists of China’s almost complete departure from the basic requirements that the United States made to conclude a deal.
The agency’s sources claim that the People’s Republic of China, within the framework of the draft agreement, is giving up on a compromise that would see it make a commitment to change its own legislation in order to resolve the problems that the American side says caused the United States to enter into a trade war with the Asian state in the first place.
In particular, China, according to the agency, refuses to tighten legislation after the US accused it of stealing intellectual property and trade secrets, manipulating currency, unfair competition policies, access to financial services, and forced technology.
According to Reuters, the response to the draft of the upcoming Chinese-American agreement were particularly inflammatory statements of US President Donald Trump on May 5th on his Twitter page that on May 10, duties on Chinese products totaling $ 200 billion will be increased from 10% to 25%. This was a unilateral ‘surprise’ announcement that has derailed, for the Chinese, any further possible talks.
In addition, according to him, Chinese goods worth $ 325 billion more are not subject to duties now, but in the near future they will be charged the same 25%. At the same time, he expressed dissatisfaction with the too slow pace of trade negotiations with China.
Christopher Dembik, head of macro analysis at Saxo Bank, in an interview with RIA Novosti emphasized that strengthening US sanctions against Iran could complicate the already difficult US-Chinese negotiations on trade.
“Perhaps this is just another episode in the wrestling match between China and the United States, but it may be counterproductive in the short term, further complicating the negotiations. – states Dembik . – From the point of view of the market, this new round of negotiations is of no interest. The proposed agreement is already taken into account by the market, and under the most favorable scenario this may occur in early June. ”
In April, China recorded a record increase in oil imports, despite maintenance stops at oil refineries (refineries) and low domestic demand for oil. And last Sunday, US President Donald Trump announced an increase from May 9 of duties on a number of Chinese goods from 10% to 25%.