United States President Donald Trump has signed into law a bill that imposes tough new conditions that have to be met before sanctions are lifted.

The Zimbabwe president Emmerson Mnangagwa has said that his country is open for business, but this new law – the Zimbabwe Democracy and Economic Recovery Amendment Act – could scupper those plans as far as the US is concerned.

The United States law says that in order for sanctions to end the election has to be “widely accepted as free and fair”. The other condition mentioned is that the army has to “respect the fundamental rights and freedoms of all persons and to be nonpartisan in character”.

In the days following the poll, six opposition supporters died in clashes with the army, which has led some to question about its neutrality.

Zimbabwe is also required to take steps towards “good governance, including respect for the opposition”.

The United States has criticised the treatment of opposition supporters and in particular key opposition figure Tendai Biti, who has been arrested in connection with the post-election violence.

“The United States government is gravely concerned by credible reports of numerous detentions, beatings, and other abuses of Zimbabweans over the past week, particularly targeting opposition activists”, State Department spokespersonHeather Nauert said.

“We call on Zimbabwe’s leaders to guarantee Mr Biti’s physical safety and ensure his constitutional and human rights are respected.”

The United States began imposing sanctions on Zimbabwe in 2001. The sanctions imposed in Zimbabwe target individuals, as well as banning trade in defence items and direct government assistance for non-humanitarian programmes.

However, Emmerson Mnangagwa’s pledge for free and fair poll has been marred by post-electoral violence that claimed seven lives after soldiers opened fire in Harare’s crowded streets last week.

 

Source: Report Focus News

European companies can be protected from new U.S. sanctions on Iran, a junior British foreign minister said on Tuesday, after President Donald Trump withdrew from an international agreement designed to deny Tehran the ability to build nuclear weapons.
 
As Washington’s so-called snapback sanctions are reinstated on Tuesday, a new EU law to shield European companies will also take effect to try to mitigate what EU officials say is their unlawful reach beyond U.S. borders.
 
“If a company fears legal action taken against it and enforcement action were taken against it by an entity in response to American sanctions then that company can be protected as far as EU legislation is concerned,” Alistair Burt, the British minister of state for the Middle East, told BBC radio.
 
“It is a commercial decision for companies whether they continue to work in Iran.”
 
 
Source: PMNEWSNIGERIA
U.S. President Donald Trump acknowledged on Sunday that his son met with Russians in 2016 at Trump Tower to get information on his election opponent Hillary Clinton, saying it was “totally legal” and “done all the time in politics.”
 
The Republican president had previously said the meeting was about the adoption of Russian children by Americans.
 
Trump’s morning Twitter post was his most direct statement on the purpose of the meeting, though his son and others have said it was to gather damaging information on the Democratic candidate.
 
In a post on Twitter, Trump also denied reports in the Washington Post and CNN that he was concerned his eldest son, Donald Trump Jr., could be in legal trouble because of the meeting with the Russians, including a lawyer with Kremlin ties.
 
He repeated that he had not known about the meeting in advance.
 
“Fake News reporting, a complete fabrication, that I am concerned about the meeting my wonderful son, Donald, had in Trump Tower. This was a meeting to get information on an opponent, totally legal and done all the time in politics – and it went nowhere. I did not know about it!” Trump said.
 
Political campaigns routinely pursue opposition research on their opponents, but not with foreign representatives from a country viewed as an adversary. Russian officials were under U.S. sanctions at the time.
 
Special Counsel Robert Mueller is examining whether Trump campaign members coordinated with Russia to sway the White House race in his favor. Russian President Vladimir Putin has denied his government interfered.
 
One part of the inquiry has focused on a June 9, 2016, meeting at Trump Tower in New York between Donald Jr., other campaign aides and a group of Russians.
 
Email released by Donald Jr. himself showed he had been keen on the meeting because his father’s campaign was being offered potentially damaging information on Clinton.
 
Donald Jr. said later he realized the meeting was primarily aimed at lobbying against the 2012 Magnitsky sanctions law, which led to Moscow denying Americans the right to adopt Russian orphans.
 
President Trump has repeatedly denied that his campaign worked with Moscow, saying “No Collusion!” Last week, however, he adopted his lawyers’ tactics and insisted “collusion is not a crime.”
 
While collusion is not a technical legal charge, Mueller could bring conspiracy charges if he finds that any campaign member worked with Russia to break U.S. law. Working with a foreign national with the intent of influencing a U.S. election could violate multiple laws, according to legal experts.
 
CNN reported last month that Michael Cohen, the president’s longtime personal lawyer, was willing to tell Mueller that Trump did know about the Trump Tower meeting in advance.
 
Trump’s lawyers and the White House have given conflicting accounts about whether Trump was involved in crafting Donald Jr.’s response to a New York Times article last summer revealing the Trump Tower meeting with the adoptions rationale. Trump’s lawyers acknowledged in a letter to Mueller’s team in January 2018 that Trump dictated the response, according to the Times.
 
Trump has stepped up his public attacks on the Mueller probe since the first trial to arise from it began last week in Alexandria, Virginia, involving former Trump campaign chairman Paul Manafort.
 
The federal tax and bank fraud charges Manafort faces are not related to the Trump campaign but Manafort’s close relations with Russians and a Kremlin-backed Ukrainian politician are under scrutiny in the trial.
 
Trump’s attacks on the special counsel’s investigation have been rebuffed by Republican leaders in Congress who have expressed support for Mueller.
 
“The president should be straightforward with the American people about the threat to our election process that Russia, Putin in particular, is engaged in is ongoing,” Representative Ed Royce, chairman of the House Foreign Affairs Committee, said on CNN’s “State of the Union” on Sunday.
 
One of the president’s personal lawyers said on Sunday that if Trump is subpoenaed by the special counsel, his lawyers will attempt to quash it in court. Any legal battle over whether the president can be compelled to testify could go all the way to the U.S. Supreme Court, the lawyer, Jay Sekulow, said on ABC’s “This Week.”
 
U.S. intelligence agencies concluded last year that Russia interfered in the 2016 U.S. election with a campaign of hacking into Democratic Party computer networks and spreading disinformation on social media. American intelligence officials say Russia is targeting the November congressional elections, which will determine whether or not Republicans keep control of both chambers of the U.S. Congress.
 
 
Source: Reuters
 
 
 
 

State terrorism comes in many forms, but one of its most cruel and revolting expressions is when it is aimed at children.

Even though U.S. President Donald Trump backed down in the face of a scathing political and public outcry and ended his administration’s policy of separating migrant children from their parents, make no mistake: His actions were indeed a form of terrorism.

That he was defiant until his back was against the wall points not only to a society that has lost its moral compass, but has also descended into such darkness that it demands both the loudest forms of moral outrage and a collective resistance aimed at eliminating the narratives, power relations and values that support it.

State violence against children has a long, dark history among authoritarian regimes.

Josef Stalin’s police took children from the parents he labelled as “enemies of the people.” Adolf Hitler, Francisco Franco and Augusto Pinochet all separated children from their families on a large scale as a way to punish political dissidents and those parents considered disposable.

Now we can add Trump to the list of the depraved.

Amnesty International called Trump’s decision to separate children from their parents and warehouse them in cages and tents for months as a cruel policy that amounts to “nothing short of torture.”

Many of the parents whose children were taken away from them entered the country legally, unwittingly exposing what resembles a state-sanctioned policy of racial cleansing. And federal U.S. officials have said despite Trump’s about-face, children who have already been separated from their parents — more than 2,000 of them — will not be reunited with them.

Immigrant children are shown outside a former Job Corps site that now houses them on June 18, 2018, in Homestead, Fla. (AP Photo/Wilfredo Lee)

In any democratic society, the primary index through which a society registers its own meaning, vision and politics is measured by how it treats its children, and its commitment to the ideal that a civilized society is one that does everything it can to make the future and the world a better place for youth.

Abuse and terror

By this measure, the Trump administration has done more than fail in its commitment to children. It has abused, terrorized and scarred them. What’s more, this policy was ludicrously initiated and legitimized by Attorney General Jeff Sessions, a notorious anti-immigrant advocate, with a Bible verse that was used historically by racists to justify slavery.


Read more: The Bible's message on separating immigrant children from parents is a lot different from what Jeff Sessions thinks


In the name of religion and without irony, Sessions put into play a policy that has been a hallmark of authoritarian regimes.

At the same time, Trump justified the policy with the notorious lie that the Democrats have to change the law for the separations to stop, when in actuality the separations are the result of a policy inaugurated by Sessions under Trump’s direction.

Trump wrote on Twitter that the Democrats are breaking up families.

Yet according to the New York Times:

Mr. Trump was misrepresenting his own policy. There is no law that says children must be taken from their parents if they cross the border unlawfully, and previous administrations have made exceptions for those travelling with minor children when prosecuting immigrants for illegal entry. A “zero tolerance” policy created by the president in April and put into effect last month by the attorney general, Jeff Sessions, allows no such exceptions, Mr. Trump’s advisers say.

Homeland Security Secretary Kirstjen Nielsen actually elevated Trump’s lie to a horrendous act of wilful ignorance and complicity.

This is an extension of the carceral state to the most vulnerable groups, putting into play a punitive policy that signals a descent into fascism, American-style.

The New Yorker’s Marsha Gessen got it right in comparing Trump’s policies towards children to those used by Vladimir Putin in Russia, both of which amounts to what she calls “an instrument of totalitarian terror.”

Both countries arrest children in order to send a powerful message to their enemies. In this case, Trump’s message was designed to terrorize immigrants while shoring up his base, while Putin’s message is to squelch dissent in general among the larger populace. Referring to Putin’s reign of terror, she writes:

The spectacle of children being arrested sends a stronger message than any amount of police violence against adults could do. The threat that children might be removed from their families is likely to compel parents to keep their kids at home next time — and to stay home themselves.

Children screaming for their parents

Within the last few weeks, heart-wrenching reports, images and audio have emerged in which children, including infants, were forcibly separated from their parents, relocated to detention centres under-staffed by professional caretakers and housed in what some reporters have described as cages.

The consequences of Trump’s xenophobia are agonizingly clear in reports of migrant children screaming out for their parents, babies crying incessantly, infants housed with teenagers who don’t know how to change diapers and shattered and traumatized families.

The Trump administration has detained more than 2,000 children. What’s more, the Trump administration has lost track of more than 1,500 children it first detained.

In some cases, it deported parents without first uniting them with their detained children. What is equally horrifying and morally reprehensible is that previous studies, such as those done by Anna Freud and Dorothy Burlingham in the midst of the Second World War, indicated that children separated from their parents suffered both emotionally in the short run and were plagued by long-term separation anxieties.

It’s no wonder the American Academy of Pediatrics referred to the Trump administration’s policy of separating children from their families as one of “sweeping cruelty.”

Christopher Baker, 3, holds a sign that reads ‘Which baby deserves to sleep in a cage?’ as he attends a Poor People’s Campaign rally with his mother in Olympia, Wash., on June 18. (AP Photo/Ted S. Warren)

Trump has mobilized the fascist fervour that inevitably leads to prisons, detention centres and acts of domestic terrorism and state violence. Echoes of Nazi camps, Japanese internment prisons and the mass incarceration of Black and brown people, along with the destruction of their families, are now part of Trump’s legacy.

Shameless cruelty now marks the neoliberal fascism currently shaping American society. Trump used children as hostages in his attempt to implement his racist policy of building a wall on the U.S.-Mexico border and to please his white supremacist base.

Trump’s racism was on full display as he dug in to defend this white supremacist policy.

He likened migrants to insects or disease-carrying rodents. In the past, he has also called undocumented immigrants “animals.” This is a rhetoric with a dark past. The Nazis used similar analogies to describe Jews. This is the language of white supremacy and neo-fascism.

Long history in the U.S.

But let’s be clear. While the caging of children provoked a great deal of moral outrage across the ideological spectrum, the underlying logic has been largely ignored.

These tactics have a long history in the United States, and in recent years have been intensified with the collapse of the social contract, expanding inequality and the increasing criminalization of a range of behaviours associated with immigrants, young people and those populations considered most vulnerable.


Read more: Fascism’s return and Trump’s war on youth


The horrible treatment of immigrant parents and children by the Trump regime signals not only a hatred of human rights, justice and democracy, it lays bare a growing fascism in the United States in which politics and power are now being used to foster disposability. White supremacists, religious fundamentalists and political extremists are now in charge.

It’s all a logical extension of his plans to deport 300,000 immigrants and refugees, including 200,000 Salvadorans and 86,000 Hondurans, by revoking their temporary protected status.

His cruelty is also evident in his rescinding of DACA for 800,000 so-called dreamers and the removal of temporary protected status for 248,000 refugees.

“Making America Great Again” and “America First” morphed into an unprecedented and unapologetic act of terrorism against immigrants. While the Obama administration also locked up the families of immigrants, it eventually scaled back the practice.

Under Trump, the savage practice accelerated and intensified. His administration refused to consider more humane practices, such as community management of asylum-seekers.

It all functions as short hand for making America white again, and signals the unwillingness of the United States to break from its past and the ghosts of a lethal authoritarianism.

Trump’s admiration of dictators

It’s also more evidence of Trump’s love affair with the practices of other dictators like Putin and now Kim Jong Un. And it signals a growing consolidation of power that is matched by the use of the repressive powers of the state to brutalize and threaten those who don’t fit into Trump’s white nationalist vision of the United States.

There is more at work here than the collapse of humanity and ethics under the Trump regime, there is also a process of dehumanization, racial cleansing and a convulsion of hatred toward those marked as disposable that echoes the darkest elements of fascism’s tenets.

The U.S. has now entered into a new era of racial hatred.

What has happened to the children and parents of immigrants does more than reek of cruelty, it points to a country in which matters of life and death have become unmoored from the principles of justice, compassion and democracy itself.

The horrors of fascism’s past have now travelled from the history books to modern times. The steep path to violence and cruelty can no longer be ignored. The time has come for the American public, politicians, educators, social movements and others to make clear that resistance to the emerging fascism in the United States is not an option —but a dire and urgent necessity.

 

Henry Giroux, Chaired professor for Scholarship in the Public Interest in the Department of English and Cultural Studies, McMaster University

This article was originally published on The Conversation. Read the original article.

President Donald Trump directed the US Trade Representative to prepare new tariffs on $200bn (R2.77tr) in Chinese imports Monday as the two nations moved closer to a potential trade war.
 
The tariffs, which Trump wants set at a 10% rate, would be the latest round of punitive measures in an escalating dispute over the large trade imbalance between the two countries. Trump recently ordered tariffs on $50bn (R692.77bn) in Chinese goods in retaliation for intellectual properly theft. The tariffs were quickly matched by China on US exports.
 
"China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology," Trump said in a statement Monday announcing the new action. "Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong."
 
Trump added: "These tariffs will go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced."
 
Trump said that if China responds to this fresh round of tariffs, then he will move to counter "by pursuing additional tariffs on another $200bn (R2.77tr)of goods."
 
Trump's comments came hours after the top US diplomat accused China of engaging in "predatory economics 101" and an "unprecedented level of larceny" of intellectual property.
 
He said China's recent claims of "openness and globalisation" are "a joke." He added that China is a "predatory economic government" that is "long overdue in being tackled," matters that include IP theft and Chinese steel and aluminum flooding the US market.
 
"Everyone knows ... China is the main perpetrator," he said. "It's an unprecedented level of larceny."
 
"Just ask yourself: Would China have allowed America to do to it what China has done to America?" he said later. "This is predatory economics 101."
 
The Chinese Embassy in Washington did not immediately respond to a request for comment.
 
Pompeo raised the trade issue directly with China last week, when he met in Beijing with President Xi Jinping and others.
 
"I reminded him that's not fair competition," Pompeo said.
 
Wall Street has viewed the escalating trade tensions with wariness, fearful they could strangle the economic growth achieved during Trump's watch. Gary Cohn, Trump's former top economic adviser, said last week that a "tariff battle" could result in price inflation and consumer debt — "historic ingredients for an economic slowdown."
 
Pompeo on Monday described US actions as "economic diplomacy," which, when done right, strengthens national security and international alliances, he added.
 
"We use American power, economic might and influence as a tool of economic policy," he said. "We do our best to call out unfair economic behaviors as well."
 
In a statement, Trump says he has an "excellent relationship" with Xi, "but the United States will no longer be taken advantage of on trade by China and other countries in the world."
 
Source: Fin24
US President Donald Trump proposed the complete elimination of all barriers to international trade at a Group of Seven summit, a move that turns the tables on allies who accuse the US of wielding protectionist policies.
 
“No tariffs, no barriers, that’s the way it should be, and no subsidies,” Trump said during a 30-minute press conference on the sidelines of the meeting in La Malbaie, Quebec. "I did suggest it and people were - I guess they’re going to go back to the drawing board and check it out."
 
White House Economic Adviser Larry Kudlow, who was invited by Trump to speak from the same podium, described the comments as Trump’s "free trade proclamation.”
 
Source: Bloomberg News

The Trump administration told lawmakers the U.S. government has reached a deal to put Chinese telecommunications company ZTE Corp back in business, a senior congressional aide said on Friday.

As with a similar announcement earlier, the proposed deal ran into immediate resistance in Congress, where Democrats and Trump's fellow Republicans accused him of bending to pressure from Beijing to ease up on a company that allegedly poses a significant risk to U.S. national security.

ZTE was banned in April from buying U.S. technology components for seven years for breaking an agreement reached after it violated U.S. sanctions against Iran and North Korea. It would now be allowed to resume business with U.S. companies, including chipmaker Qualcomm Inc.

The deal, communicated to officials on Capitol Hill by the Commerce Department, requires ZTE to pay a substantial fine, place U.S. compliance officers at the company and change its management team, the aide said. The Commerce Department would then lift an order preventing ZTE from buying U.S. products.

U.S. President Donald Trump on Tuesday floated a plan to fine ZTE up to $1.3 billion and shake up its management as his administration considered rolling back more severe penalties that have crippled the company.

The White House did not immediately confirm reports of the latest deal, but a spokeswoman said, "This is a law enforcement action being handled by Commerce. We are making sure ZTE is held accountable for violating U.S. sanctions, pays a big price, and that we are protecting our security infrastructure and U.S. jobs."

Fox News said Trump told them on Thursday that he had negotiated the $1.3 billion fine with Chinese President Xi Jinping in a phone call.

ZTE, which is publicly traded but whose largest shareholder is a Chinese state-owned enterprise, agreed last year to pay a nearly $900 million penalty and open its books to a U.S. monitor for breaking a 2017 agreement after it was caught illegally shipping U.S. goods to Iran and North Korea, in an investigation dating to the Obama administration.

The company has lost over $3 billion since the April 15th ban on doing business with U.S. suppliers, according to a source familiar with the matter.

Responding to news of the administration's proposed settlement with ZTE, Republican Senator Marco Rubio tweeted: "Yes they have a deal in mind. It is a great deal ... for #ZTE & China. #China crushes U.S. companies with no mercy & they use these telecomm companies to spy & steal from us."

Rubio, as well as Democratic Senators Chuck Schumer and Chris Van Hollen, said Congress should act to stop Trump from letting ZTE get back into business.

U.S. intelligence and U.S. law enforcement agencies have serious concerns that ZTE and other Chinese telecommunications firms use their equipment to gather intelligence on U.S. citizens.

William Evanina, the acting director of the National Counterintelligence and Security Center, said at his May 15 confirmation hearing that he would not use a ZTE phone nor recommend that anyone in a sensitive position in government use one.

Chinese officials sought a pullback on ZTE as part of any broader deal to prevent a trade war between the world's two biggest economies. U.S. Commerce Secretary Wilbur Ross is scheduled to visit China next week for another round of talks.

ZTE needs U.S. components for its mobile phones and network equipment. U.S. companies provide an estimated 25 percent to 30 percent of components in ZTE's equipment.

As part of the agreements ZTE made last year it dismissed four senior employees.

Shares of ZTE's U.S. suppliers traded higher on Friday. Optical networking equipment maker Acacia Communications Inc, which got 30 percent of 2017 revenue from ZTE, rose 4.4 percent. Optical component company Oclaro Inc, which received 18 percent of its fiscal 2017 revenue from ZTE, rose 2.7 percent.

 

Source:  

Nigerian President Muhammadu Buhari is scheduled to meet US President Donald Trump next week. His visit comes less than four months since Trump made the comment about “shithole” countries in Africa. Trump’s comments were followed by a swift denial and a lukewarm attempt to mend fences.

But his lethargic attitude to the continent is undeniable. This was underscored by the fact that the president sacked former Secretary of State Rex Tillerson when he was on an African tour, forcing him to cut his trip short. Further evidence of his perceived indifference is the fact that he has not appointed substantive senior leadership within the state department to handle African affairs. As a result, his African policy is driven by a makeshift team that has shown no real desire to mediate Africa’s strategic interests and aspirations.

So how does Nigeria, one of Africa’s largest economies, fit into America’s unclear vision for the continent? With a population of more than 180 million people, Nigeria is an African power house. And because of its complex religious, ethnic and regional dynamics, it presents both a challenge and an opportunity for the US.

The agenda

Perhaps Buhari’s trip to Washington will be used to reset Nigeria-US relations, particularly after the fallout from Trump’s shithole comment. The comment was particularly disturbing in Nigeria because over 700,000 Nigerians were found to be following Trump’s tweets – that’s more than 2% of his 32 million followers. This shows just how interested Nigerians are in the American president and his policies.

The official line from the Trump administration is that Buhari’s visit is an opportunity for the two leaders to discuss issues of mutual importance like economic growth, reforms and trade, terrorism, peace and security, and Nigeria’s role as a leader in Africa.

But it’s also worth remembering that Nigeria remains one of the most corrupt countries in the world. Levels of corruption have even diluted the country’s efforts in the war on terror.

Nigeria has been unable to deal decisively with the Boko Haram menace despite buying military equipment worth millions of dollars from the US. Its inability to wipe out Boko Haram has destabilised the West African region and caused a widespread refugee crisis.

Beyond the twin challenge of corruption and terrorism, Nigeria has been unable to fully benefit from America’s special economic growth and development initiative, the African Growth and Opportunity Act. This is because of structural bottlenecks like insecurity, sluggish economic growth, weak local capacity, and infrastructural problems.

The act gives selected sub-Saharan countries easier access, tax and duty free exports of selected products to the US market. But Nigeria’s performance has been dismal. Buhari’s wish list should therefore include support for private sector capacity building to meet international trade and export standards.

It should also include enhanced security cooperation and support and increased foreign direct investment.

Something else that could come up during Buhari’s visit are the human rights violations by the Nigerian military in its campaign against Boko Haram. The violations stopped the Obama administration from fully committing to Nigerian military support.

In fact, the lowest point in US-Nigeria relations came in 2014 when Nigeria cancelled a joint military exercise because the US refused to equip its military with helicopters.

From “shithole” to “deep respect”

Despite its challenges, Nigeria has long been a continental and regional power house that has supervised a vast security apparatus through the Economic Community of West African States (ECOWAS). Under Nigeria’s stewardship ECOWAS ensured that the Gambian strong man Jammeh Yahya was forced to step down in favour of his challenger who had been validly elected.

Nigeria’s role in the Gambia proved that, while it has a lot of other problems, electoral injustice is not one of them. Successive administrations have respected the constitutional norms that require an incumbent to step down after fairly losing an election. This kind of democratic leadership is strategically important to the US.

And as one of Africa’s largest economies Nigeria can boost economic growth in the region. The country is in a strategic position to take advantage of Trump’s promise to “increase free, fair and reciprocal trade” with Africa.

Finally, as Africa’s largest oil and gas producer Nigeria could become an important ally in Trump’s efforts to control the volatile oil prices fronted by the Organisation of Petroleum Exporting Countries.

Benefits to both parties

In the final analysis, what should Africa make of Buhari’s visit to Washington? Is it a just reward for Nigeria’s continental leadership, or a carefully choreographed opportunity to make Trump popular again?

I argue that it is both. Despite claiming that he has a “deep respect” for Africa, Trump is still believed to be indifferent towards the continent.

This visit has the potential to reset the US-Nigeria dynamic. And at the end of the day, Buhari will have a White House photo op that will come in handy now that he intends to run for a second term.

And Trump will have the opportunity to showcase his “deep respect” for Africa.

 

David E Kiwuwa, Associate Professor of International Studies, University of Nottingham

This article was originally published on The Conversation. Read the original article.

Tensions are escalating between China and the US over trade. The Chinese government has announced retaliatory measures on a range of American products including cars and some American agriculture products after the US listed 1,333 Chinese products to be hit by punitive tariffs of 25%.

Yet a trade war does not make economic sense for either side. Bilateral trade between the US and China was worth about US$711 billion in 2017 and Boeing’s single deal with China signed during Donald Trump’s visit to Beijing in 2016 was worth about US$37 billion alone.

The jobs and livelihoods at risk are huge. So why is there no particular desire, especially from Trump, to ease the tension and find a new solution?

There has been much talk about the US trade deficit with China and allegations that China steals US intellectual property. But the answer could lie in US fears of the Chinese government’s “Made in China 2025” initiative and how it signals the growing threat of China as an economic rival. That the official US Trade Representative’s recent investigation into Chinese trade practices mentioned the Made in China 2025 initiative more than 100 times, suggests this is the case.

Image problems

Made in China 2025 was launched by the Chinese government in 2015 to upgrade the country’s manufacturing capabilities. It is a plan to transform what China produces from a low-cost, labour-intensive model to advanced and smart manufacturing. Certain key industries such as aerospace, robotics and high-tech medical equipment have been prioritised. The hope is that China will gradually match developed countries’ manufacturing capabilities and become industry leaders.

A lot of the products from these key industries, such as industrial robots, aviation and aerospace equipment, new energy and power supplies and advanced rail machinery were all included in the tariff target list published by the US Trade Representative. So it would seem that the current situation is not simply a trade issue aimed to reduce America’s trade deficit with China. Instead, it is likely targeted at the future competition China will pose.

Made in China 2.0. shutterstock.com

China’s Made in China 2025 strategy makes perfect sense in my field of research, which concerns where products are manufactured and how this effects their popularity in the global market place. A strong and positive image of a country can generate what economists call “halo effects” on its products. So, Germans have built good reputations for their cars and engineering, France and Italy for their wine and fashion, and the US for their innovative products.

This worldwide reputation brings with it prestige and higher price premiums. Although there is still debate around whether brand origin could be more important than where the product is produced (Apple, for example designs its products in the US but manufactures them in China), there is no doubt that “Made in China” suffers from an image problem.

Chinese products have long been associated with a cheap and cheerful perception that they are not good in terms of quality or ingenuity. The Chinese government has long been aware of this view and keen to change it.

At the turn of the 21st century, it set up a policy called “Going Out” to encourage leading Chinese firms to expand internationally, acquire new technology and the tools to innovate. The two big examples were IT firm Lenovo’s takeover of IBM’s personal computer division in 2005 and Geely automotive’s purchase of Volvo in 2010. Made in China 2025 serves the same purpose – to boost China’s technology and innovation capabilities and to improve the image of Chinese products.

Impressive growth

There is no doubt that China has come a long way since the 1990s. It has built 22,000km of advanced high speed rail network within the last decade, which is more than the rest of the world combined. It is also considered as the global leader in renewable energy and technology, patent filings, commercial drones, industrial robotics and e-commerce and mobile payments.

China is already a leader in some tech. shutterstock.com

Chinese telecommunications company Huawei typifies the transformation of Chinese products in recent years. Within the last decade, Huawei has surpassed Ericsson and Nokia to become the world’s biggest telecom equipment supplier and has just overtaken Apple as the world’s second largest smartphone maker, behind Samsung.

What’s more remarkable about these statistics is that Huawei has transformed itself from a cheap phone maker to an accepted premium brand that can compete with Apple and Samsung. Its latest releases the top of the range Huawei P20 Pro will retail for US$1,100 and its top end model Huawei Porsche Design Mate RS will sell for US$2,109 – even more than the iPhone X.

There is no doubt that some in the US are uncomfortable with China’s impressive growth and feel threatened by it. It suggests the current trade dispute is not just about imports and exports, but also an incumbent superpower feeling the threat of a growing challenger.

 

Qing Shan Ding, Senior Lecturer in Marketing, University of Huddersfield

This article was originally published on The Conversation. Read the original article.

Chinese President Xi Jinping promised on Tuesday to open the country's economy further and lower import tariffs on products like cars, in a speech seen as an attempt to defuse an escalating trade dispute with the United States.

While much of his pledges were reiterations of previously announced reforms that foreign businesses say are long overdue, Xi's comments sent stock markets and the U.S. dollar higher on hopes of a compromise that could avert a trade war. Xi said China will widen market access for foreign investors, addressing a chief complaint of its trading partners and a point of contention for U.S. President Donald Trump's administration, which has threatened billions of dollars in tariffs on Chinese goods.

Trump struck a conciliatory tone in response to Xi's speech, saying in a post on Twitter that he was "thankful" for the Chinese leader's kind words on tariffs and access for U.S. automakers, as well as his "enlightenment" on the issue of intellectual property.

"We will make great progress together!" Trump tweeted.

Washington charges that Chinese companies steal the trade secrets of American companies and force them into joint ventures to get hold of their technology, an issue that is at the center of Trump's current tariff threats.

The latest comments from both leaders appear to reinforce a view that a full-scale trade war can be averted, although there have been no talks between the world's two economic superpowers since the U.S. tariffs were announced.

"President Xi’s speech appears to have struck a relatively positive tone and opens the door to potential negotiations with the U.S. in our view. The focus now shifts to the possible U.S. response," economists at Nomura said.

"But of course actions speak louder than words. We will keep an eye on the progress of those opening-up measures."

The speech at the Boao Forum for Asia in the southern province of Hainan had been widely anticipated as one of Xi's first major addresses in a year in which the ruling Communist Party marks the 40th anniversary of its landmark economic reforms and opening up under former leader Deng Xiaoping.

Xi said China would raise the foreign ownership limit in the automobile, shipbuilding and aircraft sectors "as soon as possible" and push previously announced measures to open the financial sector.

"This year, we will considerably reduce auto import tariffs, and at the same time reduce import tariffs on some other products," Xi said.

He said "Cold War mentality" and arrogance had become obsolete and would be repudiated. His speech did not specifically mention the United States or its trade policies, which have been assailed by Chinese state media in recent days. Vice Premier Liu He had already vowed at the World Economic Forum in January that China would roll out fresh market opening moves this year, and that it would lower auto import tariffs in an "orderly way".

Chinese officials have promised since at least 2013 to ease restrictions on foreign joint ventures in the auto industry, which would allow foreign firms to take a majority stake. They currently are limited to a 50 percent stake in joint ventures and cannot establish their own wholly owned factories.

Tesla's Chief Executive Elon Musk has railed against an unequal playing field in China and wants to retain full ownership over a manufacturing facility the company is in talks to build there.

"This is a very important action by China. Avoiding a trade war will benefit all countries," Musk tweeted after Xi's speech.

Foreign business groups welcomed Xi's commitment to reforms, including promises to strengthen legal deterrence on intellectual property violators, but said the speech fell short on specifics.

"Ultimately U.S. industry will be looking for implementation of long-stalled economic reforms, but actions to date have greatly undermined the optimism of the U.S. business community," said Jacob Parker, vice president of China operations at the U.S.-China Business Council.

EASING OF TENSION

Jonas Short, head of the Beijing office at Everbright Sun Hung Kai, said the market was cheered by Xi's speech because it was framed in more positive terms which could ease trade tensions, but he voiced caution about promised reforms.

"China is opening sectors where they already have a distinct advantage, or a stranglehold over the sector," Short said, citing its banking industry, which is dominated by domestic players.

Xi's renewed pledges to open up the auto sector come after Trump on Monday criticized China on Twitter for maintaining 25 percent auto import tariffs compared to the United States' 2.5 percent duties, calling such a relationship with China not free trade but "stupid trade."

Analysts have cautioned that any Chinese concessions on autos, while welcome, would be a relatively easy win for China to offer the United States, as plans for opening that sector had been under way well before Trump took office. But Vice Commerce Minister Qian Keming said at the forum on Tuesday that China's economic reforms were driven by domestic factors and not due to external pressures.

Xi said China would accelerate opening up its insurance industry, with Shanghai Securities News citing a government researcher after the speech saying foreign investors should be able to hold a controlling stake or even full ownership of an insurance company in the future.

Trump's move last week to threaten China with tariffs on $50 billion in Chinese goods was aimed at forcing Beijing to address what Washington says is deeply entrenched theft of U.S. intellectual property and forced technology transfers from U.S. companies. Chinese officials deny such charges, and responded within hours of Trump's announcement of tariffs with their own proposed commensurate duties.

The move prompted Trump last week to threaten tariffs on an additional $100 billion in Chinese goods, which have yet to be identified. None of the announced duties have been implemented yet, offering room for negotiation.

Beijing charges that Washington is the aggressor and spurring global protectionism, although China's trading partners have complained for years that it abuses World Trade Organization rules and practices unfair industrial policies that lock foreign companies out of crucial sectors with the intent of creating domestic champions.

While U.S. officials, including Trump, have recently expressed optimism that the two sides would hammer out a trade deal, Chinese officials in recent days have said negotiations would be impossible under "current circumstances". Dallas Federal Reserve Bank President Robert Kaplan, on a visit to Beijing, said he was optimistic that very few if any of the proposed tariffs by the United States and China announced in recent weeks will actually be implemented.

"I think it’s so clearly in the interest of both countries that we have a constructive trading relationship and that we have substantive talks to redress these issues.”

 

Page 1 of 2

  1. Opinions and Analysis

Calender

« August 2018 »
Mon Tue Wed Thu Fri Sat Sun
    1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31