US and China Show Goodwill, Take Action To Aid in Trade Talks

According to official Chinese media reports, Chinese importers have begun making new arrangements to purchase U.S. agricultural goods, including making price inquiries by related import companies on goods like soybeans. This is part of recent plans to reopen trade negotiations and demonstrate goodwill between the U.S. and China, a consensus that was reached by the leaders of both nations at the Group of 20 summit of leading and emerging-market nations in Osaka.

After the Osaka summit, the U.S. exempted 110 different Chinese manufactured goods from increased tariffs, and promoted the continued supply of goods to Huawei and other Chinese firms. These moves are considered part of the United States’ stance to alleviate tense trade relations between the two countries. On July 18, Chinese Vice Premier Liu He spoke with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin by phone to discuss implementing the G-20 agreement and the next step in negotiations.

The trade war has caused harm to both the U.S. and Chinese economies, and thrown normal trading practices between the two into disarray. Products now undergoing price inquiry by Chinese import firms, like soybean, cotton, pork, sorghum and more, are Chinese necessities and should have been bought from the U.S. all along. In order to counter America’s unfair trade practices, China recently stopped buying these products from the United States, instead purchasing them from other countries. Changes in the trade relationship between the two countries will determine when, and to what extent, China resumes its former purchasing norms.

Since the China-U.S. trade war broke out last year, China has said it is unwilling to fight, but unafraid to fight, and must fight when necessary. By firmly countering U.S. tariff hikes, China has shown that it is committed to protecting its national interests and will refuse unprincipled compromises. This has earned China worldwide respect. At the same time, China has kept the door to negotiations open, preserving the ability to mold and influence the development of the situation.

The U.S. needs the Chinese market; regardless of how the trade war continues, that fact can’t be denied. China’s enormous market is the source of its strength, and it is wisely using it for leverage.

Objectively speaking, the U.S. initiated the trade war. It has more methods and tools at its disposal, and it has a more apparent advantage. However, for more than a year, China’s response has demonstrated that we have a strong enough foundation to withstand and outlast the trade war, and that we know when to advance and when to retreat. In addition, Chinese society has shown a high degree of unity overall, increasing the deterrence power of China’s approach.

At the start of the trade war, some doubted that China would be able to use the purchase of agricultural products as a tool, believing that the Chinese market had already developed a dependence on the high-quality goods produced in the U.S. However, the facts have proven that China is highly flexible when it comes to the purchase of U.S. agricultural products. The impact on the U.S. created by this change is far greater than the side effects on the Chinese market. Now, the U.S. is economically and politically focused on the issue of agricultural products.

The resumption of the purchase of American agricultural products will both promote China-U.S. trade talks and better satisfy the Chinese market. This is a result of China’s methodical coordination and planning. It appears that the China-U.S. trade games will go on for some time. We must use the tools at our disposal to their fullest potential to effectively serve China’s national interest.

Now, it is clearer to both sides that an outcome where one fully overpowers the other is impossible. Dragging the trade war out can only end in mutual exhaustion. The only way to end the war is for both sides to cooperate, interact with goodwill, and resolve the present deadlock.

The consensus reached by the leaders of the two nations at the Osaka summit has once again established a goal for ending the trade war. Now, both sides have started to show goodwill. In addition, leaders of the two nations’ negotiating teams have held two meetings by phone, and in-person talks will soon begin. We hope that this progress will gain constructive, lasting momentum, and that the agreement between the two nations will bear tangible results.