Beijing experts’ latest message as trade talks stall: The US needs China

Now, there have been no announcements about the next round of talks, and markets await some signal about the future of the trade war that’s roiled stocks over the last year. This big economic system will give America more material benefits, including employment, including products, including product exports, including revenues,” Wei said, according to Mandarin-language remarks translated by CNBC. “Originally, we believed that in the U.S.-China economic trade relationship … we could mutually co


Now, there have been no announcements about the next round of talks, and markets await some signal about the future of the trade war that’s roiled stocks over the last year. This big economic system will give America more material benefits, including employment, including products, including product exports, including revenues,” Wei said, according to Mandarin-language remarks translated by CNBC. “Originally, we believed that in the U.S.-China economic trade relationship … we could mutually co
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Company: cnbc, Activity: cnbc, Date: 2019-05-23  Authors: evelyn cheng
Keywords: news, cnbc, companies, economic, war, experts, including, long, needs, trade, talks, latest, message, china, products, wei, beijing, chinese, stall


Beijing experts' latest message as trade talks stall: The US needs China

A Chinese flag is seen in front of containers at the Yangshan Deep-Water Port, an automated cargo wharf, in Shanghai on April 9, 2018. Johannes Eisele | AFP | Getty Images

China’s domestic media is rallying the country’s population with messages of standing firm against American “bullying,” while Chinese government-aligned experts are stressing to an overseas audience that the U.S. will need to negotiate. The world’s two largest economies have been locked in a trade fight for more than a year. Both sides appeared to be making progress until early this month, when President Donald Trump accused China of reneging on a deal and raised tariffs on an additional $200 billion in Chinese products to 25%. Beijing retaliated with raising levies on $60 billion worth of U.S. products. Now, there have been no announcements about the next round of talks, and markets await some signal about the future of the trade war that’s roiled stocks over the last year. Throughout this current lull, China’s state-run newspapers and television channels have taken an increasingly anti-American tone. Still, the country’s expert class is emphasizing what the U.S. has to gain from cooperating with Beijing. “In the next 20 to 30 years, the U.S. shouldn’t miss out on this opportunity and lose the China market,” Wei Jianguo, a former vice minister at China’s Ministry of Commerce, told CNBC in an interview Wednesday. He is now vice chairman and deputy executive officer at Beijing-based think tank China Center for International Economic Exchanges.

Personally, I think, as long as there is negotiation, then there will be results. Wei Jianguo a former vice minister at China’s Ministry of Commerce

“I believe Americans should grasp this opportunity. This big economic system will give America more material benefits, including employment, including products, including product exports, including revenues,” Wei said, according to Mandarin-language remarks translated by CNBC. “Personally, I think, as long as there is negotiation, then there will be results,” he said. On the same day, two speakers addressing foreign reporters at a small press event organized by the government’s main information office echoed some of Wei’s sentiments. “My personal view is that, from the perspective of U.S. businesses, if the trade war continues, it will … have a negative impact on what was a good relationship between U.S. and Chinese businesses,” said Li Yong, deputy director of the expert committee at the China Association of International Trade, which falls under the Commerce Ministry’s direct leadership. “At the end of the day, the image and influence U.S. businesses have developed over the long term will (be affected). It’s a pity.” The other speaker, Zhang Yansheng, head researcher at the China Center for International Economic Exchanges, also emphasized that Beijing would like to keep negotiating with the U.S. It could even be a years-long process that cycles through negotiation and fights, he said. The tone stands in contrast to state-run media, whose Chinese-language reports in the last two weeks have promoted the country’s ability to defy pressure from the U.S. For the last several days, the national broadcaster CCTV has also been airing anti-U.S. movies set during the Korean War. On Wednesday, the prime-time evening report featured Chinese President Xi Jinping’s visit earlier in the week to the province of Jiangxi. The Chinese leader’s remarks during the visit about rare earth elements as an “important strategic resource” and a “new Long March ” signaled to many that Beijing is resolved not to bend to American demands.

Who needs a deal?

At Wednesday’s news conference, Li said China is in a position where it can’t appease American demands. “Originally, we believed that in the U.S.-China economic trade relationship … we could mutually cooperate and rely on each other,” he said in Mandarin. “But now we need to revisit this.” Analysts generally agree that, right now, Beijing still depends heavily on the U.S. as an export market. Last year, China was the largest supplier of goods to the U.S. at $539.5 billion, according to the Office of the U.S. Trade Representative. China is trying to transform its economy into one driven by consumption rather than manufacturing. The country hosted its first import expo last fall in an effort to bill itself and its hundreds of millions of consumers as a buyer of the world’s products. “China needs the U.S. more than the U.S. needs China,” said Jacob Shapiro, director of analysis at online publication Geopolitical Futures.


Company: cnbc, Activity: cnbc, Date: 2019-05-23  Authors: evelyn cheng
Keywords: news, cnbc, companies, economic, war, experts, including, long, needs, trade, talks, latest, message, china, products, wei, beijing, chinese, stall


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German data fails to lift euro from 1-week low

“The announcement of the increased trade tariffs has generated negative sentiment about global growth and that is exerting downward pressure on the euro despite the German data,” said Nikolay Markov, senior economist at Pictet Asset Management. “We expected the data to be worse than last month, but this is going to increase concerns about the state of the Chinese economy. The market will be very nervous and looking out for the PMI data,” said Commerzbank FX strategist Esther Maria Reichelt. The


“The announcement of the increased trade tariffs has generated negative sentiment about global growth and that is exerting downward pressure on the euro despite the German data,” said Nikolay Markov, senior economist at Pictet Asset Management. “We expected the data to be worse than last month, but this is going to increase concerns about the state of the Chinese economy. The market will be very nervous and looking out for the PMI data,” said Commerzbank FX strategist Esther Maria Reichelt. The
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German data fails to lift euro from 1-week low

The euro held at a one-week low on Wednesday, ignoring data from Germany that showed the economy returned to growth in the first quarter, as trade tensions between the world’s two biggest economies cast a shadow over risk appetite.

The single currency has been caught in the cross-currents of an escalating dispute between Washington and Beijing since last week, unable to conclusively rise above the $1.1250 level.

“The announcement of the increased trade tariffs has generated negative sentiment about global growth and that is exerting downward pressure on the euro despite the German data,” said Nikolay Markov, senior economist at Pictet Asset Management.

U.S. President Donald Trump threatened higher tariffs on billions of dollars of Chinese imports last week, and Beijing responded with planned tariff hikes of its own on Monday.

The escalation in the trade dispute comes at a time when latest data from Germany showed the economy returned to growth in the March quarter as householders spent more freely and construction activity picked up.

The single currency was broadly steady at $1.1213 – just above a one-week low of $1.1197 hit in the Asian session and more than 3% below a 2019 high of nearly $1.16 in early January.

Germany’s economic figures were a sole bright indicator in an otherwise slate of dismal data.

China on Wednesday reported surprisingly weaker growth in retail sales and industrial output for April, adding pressure on Beijing to roll out more stimulus as the trade war with the United States rumbles on.

“We expected the data to be worse than last month, but this is going to increase concerns about the state of the Chinese economy. The market will be very nervous and looking out for the PMI data,” said Commerzbank FX strategist Esther Maria Reichelt.

The Aussie dollar dropped as low as $0.6922, its lowest level since Jan. 3 when a flash crash in the foreign exchange markets rocked major currencies.

Barring that level, the currency was at its weakest in three years and down 0.2% on the day.

The weak data gave further impetus to Aussie bears to add to their negative bets with net outstanding short positions still below 2019 highs of above $5.2 billion.

The Aussie is often seen as a proxy for Chinese growth because of Australia’s export-reliant economy and China being the country’s main destination for its commodities.

Domestic data added to the woes, with the pace of growth in Australian wages stagnating.

Neighbouring New Zealand saw its currency dip 0.1% to $0.6567.

The Chinese yuan itself was slightly improved on the day at 6.8993 per U.S. dollar, but still close to a five-month low hit on Tuesday.


Company: cnbc, Activity: cnbc, Date: 2019-05-15
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Trump may need more than tariff threats to rattle China on trade

President Donald Trump and China’s President Xi Jinping (not shown) make a joint statement at the Great Hall of the People on November 9, 2017 in Beijing, China. But in a surprise move, Trump tweeted Sunday local time that tariffs on $200 billion worth of Chinese goods would increase to 25% on Friday. He added that a 25% tariff would “shortly” be imposed on an additional $325 billion of imported goods from China. “The Trade Deal with China continues, but too slowly, as they attempt to renegotiat


President Donald Trump and China’s President Xi Jinping (not shown) make a joint statement at the Great Hall of the People on November 9, 2017 in Beijing, China. But in a surprise move, Trump tweeted Sunday local time that tariffs on $200 billion worth of Chinese goods would increase to 25% on Friday. He added that a 25% tariff would “shortly” be imposed on an additional $325 billion of imported goods from China. “The Trade Deal with China continues, but too slowly, as they attempt to renegotiat
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Trump may need more than tariff threats to rattle China on trade

President Donald Trump and China’s President Xi Jinping (not shown) make a joint statement at the Great Hall of the People on November 9, 2017 in Beijing, China.

U.S. President Donald Trump may have to choose between supporting the U.S. stock markets and hampering the Chinese economy enough to make Beijing bend on the ongoing trade dispute.

Reports from both sides had indicated progress in the drawn-out negotiations toward a trade deal — with an agreement even possible this week. But in a surprise move, Trump tweeted Sunday local time that tariffs on $200 billion worth of Chinese goods would increase to 25% on Friday. He added that a 25% tariff would “shortly” be imposed on an additional $325 billion of imported goods from China.

“The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!” Trump said in a tweet.

Dow futures dropped more than 450 points after Trump’s tariff threat and reports, including one from CNBC, that the Chinese were considering canceling trade talks that had been scheduled for this week.

Chinese markets, meanwhile, tanked more than 5% on Monday, but that’s unlikely to be enough to shake Beijing’s resolve.

“Trump’s latest move increases his economic leverage but will not lead China to surrender on his terms, ” Michael Hirson, practice head, China and Northeast Asia, at consulting and research firm Eurasia Group, said in an email.

“China’s political cohesion gives Beijing an important asset in withstanding the pressure from Trump, and employing economic measures to keep up growth and support weak points in the economy,” Hirson said. “But there is no question that Beijing’s challenge just got much more difficult.”

Official Chinese channels were quiet Monday morning. Chinese state media was muted on the latest Trump tweets. The Ministry of Commerce and Ministry of Foreign Affairs referred CNBC to their regular press conferences, set for Thursday and Monday afternoon, respectively.

A tariff increase on the $200 billion figure would be a delayed implementation of a raise planned for earlier this year. They would have a moderate impact on China’s economy, of about 0.2 to 0.3 percentage points, according to Nick Marro, Hong Kong-based analyst at The Economist Intelligence Unit.

On the other hand, a 25% tariff on $325 billion would put duties on virtually all goods China exports to the U.S. Such a broad application of tariffs — and expected retaliatory duties from Beijing — could hit China’s headline gross domestic product by at least 0.3 or 0.4 percentage points, slowing growth to 6% or less, Marro said in a phone interview.

UBS Economists Tao Wang and Ning Zhang had similar forecasts.


Company: cnbc, Activity: cnbc, Date: 2019-05-06  Authors: evelyn cheng
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A US detente with China and Russia would boost the world economy

Russian President Vladimir Putin and Chinese President Xi Jinping with other leaders pose for a group photo at the Second Belt and Road Forum for Econonic Cooperation on April 27, 2019 in Beijing, China. But without an architecture of verifiable trust, codified in enforceable international rules and regulations, world trade and investments would dry up. Dare we hope then that senseless tensions and ludicrous war threats among the U.S., China and Russia could soon change thanks to a sudden reviva


Russian President Vladimir Putin and Chinese President Xi Jinping with other leaders pose for a group photo at the Second Belt and Road Forum for Econonic Cooperation on April 27, 2019 in Beijing, China. But without an architecture of verifiable trust, codified in enforceable international rules and regulations, world trade and investments would dry up. Dare we hope then that senseless tensions and ludicrous war threats among the U.S., China and Russia could soon change thanks to a sudden reviva
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Company: cnbc, Activity: cnbc, Date: 2019-05-06  Authors: dr michael ivanovitch
Keywords: news, cnbc, companies, nuclear, arms, beijing, china, economy, economic, american, world, russia, detente, mad, boost, trade, president


A US detente with China and Russia would boost the world economy

Russian President Vladimir Putin and Chinese President Xi Jinping with other leaders pose for a group photo at the Second Belt and Road Forum for Econonic Cooperation on April 27, 2019 in Beijing, China. Mikhail Svetlov | Getty Images

Trust is an economic variable in short supply among the nuclear behemoths jostling for global dominance. But without an architecture of verifiable trust, codified in enforceable international rules and regulations, world trade and investments would dry up. Investments, in particular, would be hard-hit. Even after the most detailed and meticulous risk analysis, investments are always an act of faith — a leap into an unknowable future. Dare we hope then that senseless tensions and ludicrous war threats among the U.S., China and Russia could soon change thanks to a sudden revival of Mutually Assured Destruction true believers? That is a military doctrine with a long history, but a somewhat updated MAD idea is very simple: There would be no survivors to a nuclear war fought by U.S., China and Russia. Such a lunacy would spell the end to humanity.

Wisdom to stop the madness

In spite of that, some people have always thought that developing America’s capability of a devastating nuclear first strike could relegate the MAD to the dustbin of history. The U.S., those war-mongers believed, would obliterate the enemy and its second-strike chance to attack the United States. That has always been the wishful thinking of brainless hawks. Indeed, even during the breakup of the Soviet Union, and Russia’s subsequent long and deep economic and financial crisis, the country’s formidable nuclear arsenal was fully capable of playing the MAD game. And many of the cutting-edge nuclear weapons currently showcased by the Kremlin had been on the drawing boards during those difficult years. Now we also know that China’s nuclear-armed submarines — Beijing’s additional and updated second-strike capability — are being hunted by American defense forces in close proximity to U.S. maritime borders. Weaponizing space with nukes and their delivery vehicles is the last MAD frontier, and whether that madness can be stopped is not clear. But it is a hopeful sign that U.S. President Donald Trump has initiated discussions with Russia about a new nuclear arms treaty that would include China. Trump also revealed last week that, during the ongoing trade talks, Beijing “felt very strongly” about being part of the U.S.-Russia arms negotiations. Including China in the forthcoming arms talks is a good move. It can also be an important detail to enhance Washington’s bargaining power in a decisive negotiating round where key aspects of a trade deal have yet to be settled. More generally, arms talks can be part of a Kissingerian detente — an attempt to relieve tensions and address a wide range of strategic issues defining the three-country relations. An example of that is what happened last Friday during Trump’s telephone conversation with Russian President Vladimir Putin. Apart from the new arms treaty, the two men were said to have discussed the Korean problem, Venezuela’s crisis and more. Remarkably, they also talked about trade. According to U.S. data, the bilateral merchandise trade last year reached a puny $27.5 billion. But that was still a 16% increase from 2017, despite punishing American sanctions on business dealings with Russia. It is possible that the value of those trade transactions could rapidly double, or triple, if Washington and Moscow could come to terms with respect to some of the acute strategic issues they have been facing over the last five years. American companies are participating at the main economic forums in Russia, apparently waiting for thawing political relations to step up trade and investments and make up some of the ground lost on Russian markets to their European and Asian competitors.

Don’t bludgeon, compete with China

A much larger business is at stake with China, where U.S. exports represented last year only one-fifth of a $635.4 billion in two-way goods trade. That profoundly unbalanced trade relationship is taking place amid growing political and military tensions, and an increasingly difficult operating environment for American firms in China. Under those circumstances, the U.S. should insist on a rapid rebalancing of trade accounts, instead of trying to impose on Beijing structural reforms in its economic and trade policies. Pressing Beijing on structural reforms is a waste of time in a blind alley. The same is true of U.S. efforts to contain Beijing’s seemingly unstoppable spread of global economic and political interests. Except perhaps for Japan, no Asian country is ready to actively help the U.S. in opposing China’s maritime border claims and pressures on Taiwan. China also disapproves of the American policy of maximum pressure on North Korea to force a nuclear disarmament without security guarantees and the lifting of debilitating economic sanctions. Put briefly, Asians worry about having to choose between the U.S. and China, while Beijing just wants the U.S. out of Asia — an objective obliquely formulated in terms of an unwelcome interference of outside forces in Asian affairs. The U.S. solution to the China problem is a robust and peaceful competition. China calls that cooperation, adding a “win-win” mantra to sugar coat a bitter pill for losers accumulating trade deficits. But to compete with China, the U.S. needs to eschew threats and raw pressures. It must offer, instead, more attractive alternatives and meticulously protect its markets from predatory trade practices. The U.S. soft power is infinitely more appealing, and many American companies are proving that they are fully capable of profitably taking on some of the world’s most aggressive competitors.

Investment thoughts


Company: cnbc, Activity: cnbc, Date: 2019-05-06  Authors: dr michael ivanovitch
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Trump says tariffs on $200 billion of Chinese goods will increase to 25%, blames slow progress in trade talks

President Donald Trump said Sunday that tariffs on $200 billion of Chinese goods will increase to 25% on Friday, despite repeated claims by the administration in recent weeks that trade talks with Beijing were going well. Trump had originally threatened to increase the tariffs at the start of the year, but postponed that decision after China and the US agreed to sit down for trade talks. In addition, Trump threatened to impose 25% tariffs on an additional $325 billion of Chinese goods “shortly.”


President Donald Trump said Sunday that tariffs on $200 billion of Chinese goods will increase to 25% on Friday, despite repeated claims by the administration in recent weeks that trade talks with Beijing were going well. Trump had originally threatened to increase the tariffs at the start of the year, but postponed that decision after China and the US agreed to sit down for trade talks. In addition, Trump threatened to impose 25% tariffs on an additional $325 billion of Chinese goods “shortly.”
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Company: cnbc, Activity: cnbc, Date: 2019-05-05  Authors: spencer kimball
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Trump says tariffs on $200 billion of Chinese goods will increase to 25%, blames slow progress in trade talks

Chinese President Xi Jinping and U.S. President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on November 9, 2017.

President Donald Trump said Sunday that tariffs on $200 billion of Chinese goods will increase to 25% on Friday, despite repeated claims by the administration in recent weeks that trade talks with Beijing were going well.

The tariff rate on those goods was originally set at 10%. Trump had originally threatened to increase the tariffs at the start of the year, but postponed that decision after China and the US agreed to sit down for trade talks.

In addition, Trump threatened to impose 25% tariffs on an additional $325 billion of Chinese goods “shortly.”

The president said that trade talks with China are continuing, but are moving too slowly as Beijing tries to re-negotiate.

On Friday, Vice President Mike Pence told CNBC that Trump remained hopeful that he could strike a deal with China.

And on Wednesday, the White House said the latest round of talks had moved Beijing and Washington closer to an agreement. Press secretary Sarah Sanders said, “Discussions remain focused toward making substantial progress on important structural issues and re-balancing the U.S.-China trade relationship.”

There had been multiple reports that China and U.S. were close to a trade deal, and an agreement could come as soon as Friday.

Major sticking points between the U.S. and China have been intellectual property theft and forced technology transfers. There has also been disagreement as to whether tariffs should be removed or remain in place as an enforcement mechanism.

The S&P 500 is up more than 17% this year, partly on optimism that a trade agreement with China is coming soon. Apple CEO Tim Cook, for example, said on the company’s earnings call last week that improved dialogue on trade and Beijing’s economic stimulus had improved consumer confidence in the country.

“We certainly feel a lot better than we did 90 days ago,” Cook said.

In January, Apple cut its earnings guidance due in large part to softening demand for iPhones in China.

“If you look at our results, our shortfall is over 100 percent from iPhone and it’s primarily in greater China,” Cook told CNBC at the time. “It’s clear that the economy began to slow there for the second half and what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy.”

However, Apple’s stock has rebounded amid White House optimism about a China trade deal. The company’s shares are up 34% year to date.


Company: cnbc, Activity: cnbc, Date: 2019-05-05  Authors: spencer kimball
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China and US kick off latest trade talks after ‘nice’ working dinner

China and the United States began their latest talks in Beijing on Wednesday aimed at ending a bitter trade war, after U.S. Treasury Secretary Steven Mnuchin said he had a “nice” working dinner the night before with China Vice Premier Liu He. “Nice to see you, it’s good to be back here,” Mnuchin told Liu. We had a nice working dinner, thank you,” Mnuchin told reporters at his Beijing hotel, when asked if he had met with Liu on Tuesday. U.S. President Donald Trump has said that he may keep some t


China and the United States began their latest talks in Beijing on Wednesday aimed at ending a bitter trade war, after U.S. Treasury Secretary Steven Mnuchin said he had a “nice” working dinner the night before with China Vice Premier Liu He. “Nice to see you, it’s good to be back here,” Mnuchin told Liu. We had a nice working dinner, thank you,” Mnuchin told reporters at his Beijing hotel, when asked if he had met with Liu on Tuesday. U.S. President Donald Trump has said that he may keep some t
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China and US kick off latest trade talks after 'nice' working dinner

Chinese Vice Premier Liu He (R), US Treasury Secretary Steven Mnuchin (C) and Trade Representative Robert Lighthizer pose before they proceed to their meeting at the Diaoyutai State Guesthouse in Beijing on May 1, 2019.

China and the United States began their latest talks in Beijing on Wednesday aimed at ending a bitter trade war, after U.S. Treasury Secretary Steven Mnuchin said he had a “nice” working dinner the night before with China Vice Premier Liu He.

Mnuchin, along with U.S. Trade Representative Robert Lighthizer, are holding a full day of discussions, before Liu goes to Washington next week for another round of talks in what could be the end game for negotiations.

Liu greeted Mnuchin and Lighthizer as they arrived at a state guest house in Beijing and the three men exchanged pleasantries, but did not make comments directly to reporters.

“Nice to see you, it’s good to be back here,” Mnuchin told Liu. They then all went straight into the meeting room. Liu had entertained his U.S. guests on Tuesday night just after they arrived.

“We did. We had a nice working dinner, thank you,” Mnuchin told reporters at his Beijing hotel, when asked if he had met with Liu on Tuesday. He did not elaborate.

Beijing and Washington have cited progress on issues including intellectual property and forced technology transfer to help end a conflict marked by tit-for-tat tariffs that have cost both sides billions of dollars, disrupted supply chains and roiled financial markets.

But U.S. officials say privately that an enforcement mechanism for a deal and timelines for lifting tariffs are sticking points. Chinese officials have also acknowledged that they view the enforcement mechanism as crucial, but say that it must work two ways and cannot put restraints only on China.

In Washington, people familiar with the talks say that the question of whether and when U.S. tariffs on $250 billion worth of Chinese goods will be removed will probably be among the last issues to be resolved.

U.S. President Donald Trump has said that he may keep some tariffs on Chinese goods for a “substantial period”.

The United States has also been pressing China to further open up its market to U.S. firms. China has repeatedly pledged to continue reforms and make it easier for foreign companies to operate in the country.

In comments published in Wednesday, China’s top banking and insurance regulator said the government will further open up its banking and insurance sectors.


Company: cnbc, Activity: cnbc, Date: 2019-05-01
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China expands global ambitions with a new phase of Xi’s signature program

Chinese President Xi Jinping’s signature Belt and Road Initiative is now about far more than just infrastructure. The program began roughly six years ago with a focus on building out rail and maritime trade routes connecting China with central Asia, Europe and Africa. That is, the second Belt and Road Forum that wrapped up this weekend in Beijing demonstrated that the China-led program now seeks to influence technology and governance around the world. “There will be a shift away from … hard in


Chinese President Xi Jinping’s signature Belt and Road Initiative is now about far more than just infrastructure. The program began roughly six years ago with a focus on building out rail and maritime trade routes connecting China with central Asia, Europe and Africa. That is, the second Belt and Road Forum that wrapped up this weekend in Beijing demonstrated that the China-led program now seeks to influence technology and governance around the world. “There will be a shift away from … hard in
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China expands global ambitions with a new phase of Xi's signature program

Chinese President Xi Jinping’s signature Belt and Road Initiative is now about far more than just infrastructure.

The program began roughly six years ago with a focus on building out rail and maritime trade routes connecting China with central Asia, Europe and Africa. While critics have charged that the initiative is simply a branding exercise for Beijing to spread its global influence through lending — and the associated debt — for projects like ports and bridges, Xi has now made it clear he’s aiming even further.

That is, the second Belt and Road Forum that wrapped up this weekend in Beijing demonstrated that the China-led program now seeks to influence technology and governance around the world.

“There will be a shift away from … hard infrastructure projects,” Tom Rafferty, principal economist for China at The Economist Intelligence Unit, said Friday. “(The Belt and Road is) going to have a broader range.”


Company: cnbc, Activity: cnbc, Date: 2019-04-29  Authors: evelyn cheng
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Chinese businesses in Malaysia watch cautiously as Mahathir, Beijing move ahead on railway

Malaysia’s relationship with China is under scrutiny in the Southeast Asian country ahead of Prime Minister Mahathir Mohamad’s expected April visit to Beijing. Mainland Chinese businesses in Malaysia, in particular, are hopeful that the 93-year-old leader will be able to smooth ties with Asia’s dominant economic power. There are already positive signs as the two countries renegotiated a previously stalled multibillion-dollar rail project that caused uncertainty in the bilateral relationship. Li’


Malaysia’s relationship with China is under scrutiny in the Southeast Asian country ahead of Prime Minister Mahathir Mohamad’s expected April visit to Beijing. Mainland Chinese businesses in Malaysia, in particular, are hopeful that the 93-year-old leader will be able to smooth ties with Asia’s dominant economic power. There are already positive signs as the two countries renegotiated a previously stalled multibillion-dollar rail project that caused uncertainty in the bilateral relationship. Li’
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Company: cnbc, Activity: cnbc, Date: 2019-04-16  Authors: huileng tan, wang zhao, afp, getty images, sopa images
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Chinese businesses in Malaysia watch cautiously as Mahathir, Beijing move ahead on railway

Malaysia’s relationship with China is under scrutiny in the Southeast Asian country ahead of Prime Minister Mahathir Mohamad’s expected April visit to Beijing.

Mainland Chinese businesses in Malaysia, in particular, are hopeful that the 93-year-old leader will be able to smooth ties with Asia’s dominant economic power.

There are already positive signs as the two countries renegotiated a previously stalled multibillion-dollar rail project that caused uncertainty in the bilateral relationship.

Last Friday, the Malaysian Prime Minister’s Office released a statement announcing the resumption of the project at a reduced cost of 44 billion Malaysian ringgit ($10.7 billion) — two-thirds the original cost of 65.5 billion ringgit ($15.9 billion)

That could be a turning point for other deals with Chinese companies and entities, which have been awaiting a signal on the future of the bilateral relationship.

After all, the stalled train line had “more or less hurt the confidence of Chinese enterprises” operating in the Southeast Asian countries, said Keith Li, the president of the China Entrepreneurs Association in Malaysia.

In fact, there have been a “small number” of projects and developments put on hold as the Chinese companies involved take a wait-and-see approach, Li told CNBC in Kuala Lumpur last month. He declined to go into detail about those deals that had been affected.

Li’s association represents the interests of mainland Chinese businesses in Malaysia, of which there are an estimated 1,000. Li, who runs a travel agency, said he is a permanent resident of Malaysia and has lived in the country for over 20 years.

The planned rail project on Peninsular Malaysia was thrown into uncertainty after Mahathir’s party stunned international prognosticators with a win against the incumbent Najib Razak in a general election last May. Mahathir’s administration then decided that costly projects authorized by the previous administration would be cancelled or renegotiated, sparking concerns among mainland Chinese enterprises in Malaysia.

There is much at stake.

Malaysia’s finance minister, Lim Guan Eng, said in March that foreign direct investment planned by manufacturers from China rose from 3.9 billion Malaysian ringgit ($948 million) in 2017 to 19.7 billion ringgit ($4.8 billion) in 2018, an increase of over 400 percent, local media reported.

In 2018, China was one of the largest contributors to the manufacturing sector in Malaysia alongside Indonesia, the Netherlands, Japan and the U.S., government news agency Bernama reported, citing official figures.


Company: cnbc, Activity: cnbc, Date: 2019-04-16  Authors: huileng tan, wang zhao, afp, getty images, sopa images
Keywords: news, cnbc, companies, cautiously, li, stalled, mahathir, ringgit, billion, malaysian, railway, watch, project, ahead, businesses, chinese, beijing, china, malaysia, uncertainty


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Europe may be playing spoiler to the elusive US-China trade deal

The trade statistics from the U.S. Commerce Department indicate that — on Trump’s watch — China pocketed a U.S. trade surplus of $829.3 billion between January 2017 and January 2019 (the latest U.S. data point available). I believe that the Chinese are making a mistake by challenging the U.S. on such a sensitive issue. Had Beijing made such a gesture of smart statecraft, it would have smoothed the way to a fast and reasonable trade agreement. China has now become the EU’s second-largest trade pa


The trade statistics from the U.S. Commerce Department indicate that — on Trump’s watch — China pocketed a U.S. trade surplus of $829.3 billion between January 2017 and January 2019 (the latest U.S. data point available). I believe that the Chinese are making a mistake by challenging the U.S. on such a sensitive issue. Had Beijing made such a gesture of smart statecraft, it would have smoothed the way to a fast and reasonable trade agreement. China has now become the EU’s second-largest trade pa
Europe may be playing spoiler to the elusive US-China trade deal Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-15  Authors: dr michael ivanovitch, alessia pierdomenico, bloomberg, getty images
Keywords: news, cnbc, companies, spoiler, uschina, elusive, xi, eu, trade, chinese, beijing, deal, united, billion, visit, china, europe, playing, surplus


Europe may be playing spoiler to the elusive US-China trade deal

The trade statistics from the U.S. Commerce Department indicate that — on Trump’s watch — China pocketed a U.S. trade surplus of $829.3 billion between January 2017 and January 2019 (the latest U.S. data point available).

I believe that the Chinese are making a mistake by challenging the U.S. on such a sensitive issue. Granting that Washington may have gone too far in its attempts to control China’s economic policies, Beijing still could have – and should have – preempted all that by reducing its sales to the U.S. while stepping up purchases of American goods and services. That would have shown Beijing’s determination to substantially run down its excessive, and unsustainable, surpluses on U.S. trades.

Had Beijing made such a gesture of smart statecraft, it would have smoothed the way to a fast and reasonable trade agreement. And it is quite possible that such a gesture could have also opened up a new chapter of friendlier, more cooperative and more productive bilateral relations.

Indeed, Chinese President Xi Jinping cannot expect his idea of a “great power relationship” to work while China continues to maintain an excessively unbalanced trade relationship with the United States.

Beijing, of course, has its own reasons for doing what it’s doing, and its attitude on trade issues reflects a much broader view of its relations with Washington.

It is also very likely that China could have been encouraged in its intransigence on U.S. trade by the fact that America’s close friends and allies are all flocking to Beijing in search of trade and investments.

China has now become the EU’s second-largest trade partner, closely behind the United States. Beijing’s share of EU trade has tripled since 2000 to 15.4 percent, and is now only slightly below the U.S. share of 17.1 percent. The big difference is that last year the EU ran a 184 billion euro trade deficit with China, while recording a 140 billion euro trade surplus with the U.S.

A recent visit to Europe by Xi in late March followed by last week’s visit of Chinese Premier Li Keqiang are the latest indications of how much the U.S. “trade war” with China differs from majestic welcoming ceremonies and an eager search for mutually beneficial relations the Chinese statesmen have encountered during their trips to Italy, France, the EU Commission and the Balkans for an annual summit with Central and East European leaders.


Company: cnbc, Activity: cnbc, Date: 2019-04-15  Authors: dr michael ivanovitch, alessia pierdomenico, bloomberg, getty images
Keywords: news, cnbc, companies, spoiler, uschina, elusive, xi, eu, trade, chinese, beijing, deal, united, billion, visit, china, europe, playing, surplus


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Commentary: It’s time for the US and Europe to ask what sort of world China wants to build

What sort of world does China want to create? And, what should the United States and Europe do to influence the outcome? Given the choice, most countries in the world still would rather navigate a world order where the United States is the dominant actor rather than China. As it’s now clear what China wants, a coordinated U.S. and European response grows more urgent. Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United


What sort of world does China want to create? And, what should the United States and Europe do to influence the outcome? Given the choice, most countries in the world still would rather navigate a world order where the United States is the dominant actor rather than China. As it’s now clear what China wants, a coordinated U.S. and European response grows more urgent. Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United
Commentary: It’s time for the US and Europe to ask what sort of world China wants to build Cached Page below :
Company: cnbc, Activity: cnbc, Date: 2019-04-12  Authors: fred kempe, xinhua news agency, getty images
Keywords: news, cnbc, companies, sort, beijing, global, wants, build, european, europe, states, china, countries, ask, chinas, commentary, united, world


Commentary: It's time for the US and Europe to ask what sort of world China wants to build

European Union leaders sat down this week in Brussels for a summit with a China it recently branded a “systemic rival,” and the United States is nearing the end game trade talks with a China that national security documents refer to as a “strategic adversary.”

So, it’s surprising that trans-Atlantic leaders are neither working at common cause nor asking the most crucial geopolitical questions of our age.

What sort of world does China want to create?

With what means would it achieve its aims?

And, what should the United States and Europe do to influence the outcome?

By now, there is little remaining doubt that China’s continued rise marks the most significant geopolitical event shaping the 21st century. Yet U.S. and European officials — mired in issues ranging from Trump administration immigration gyrations to Brexit — have failed to give this mother of all inflection points enough attention.

Some are in denial about the fundamental change China’s rise may bring to the global order of institutions and principles established by the United States and its allies after World War II. Others concede that the structural stress between a rising China and an incumbent United States is the defining danger of our times, yet they offer neither an engagement nor containment strategy worthy of this epochal challenge.

That has produced the worst of all worlds.

Fearful that the United States has grown more determined to undermine his country’s rise, President Xi Jinping has doubled down on his determination to strengthen the Communist Party’s hold domestically while advancing China’s global influence. European allies — stung by trade actions against them and the lack of a U.S. galvanizing strategy to China — are hedging their bets.

European Council President Donald Tusk declared a “breakthrough” this week on some of the EU’s major trade disagreements, particularly regarding tech transfers and industrial state subsidies. Then in Croatia a couple of days later, Chinese Premier Li Keqiang pledged to respect EU standards and laws at a summit with Central and East European countries that closed 40 deals and expanded its ranks to Greece so that the so-called 16+1 grouping became 17+1.

That relatively positive news in Europe only further underscores the skill with which Chinese leaders are managing their historic aspirations.

Graham Allison, one of America’s most astute China watchers, quotes Singapore’s Lee Kuan Yew, who two years before his death in 2015 said this: “The size of China’s displacement of the world balance is such that the world must find a new balance. It is not possible to pretend that this is just another world player. This is the biggest player in the history of the world.”

In that context, what China wants is a play in three acts.

First, China wants ideally to push the U.S. out of its Asian region, or at the very least reduce its influence, to achieve a regional hegemony that makes all actors ultimately dependent on it. Second, it is acting globally to displace, if not yet replace, the United States wherever it can — including in major parts of Europe — most importantly through its Belt and Road Initiative.

Finally, it’s clearer than ever that Beijing by the time of the 100th anniversary of the People’s Republic of China in 2049 aspires to be the dominant economic, political and perhaps military power for an era where democracies remain but authoritarian systems are ascendant.

“China is unabashedly undermining the U.S. alliance system in Asia,” writes Oriana Skyler Mastro of Georgetown University in Foreign Affairs. “It has encouraged the Philippines to distance itself from the United States, it has supported South Korea’s efforts to take a softer line toward North Korea, and it has backed Japan’s stance against American protectionism … It is blatantly militarizing the South China Sea … It is no longer content to play second fiddle to the United States and seeks directly to challenge its position in the Indo-Pacific region.”

Yet it is beyond Asia where China’s reach has expanded fastest.

It’s hard to overstate the importance of the Belt and Road Initiative, whose impact on its times may outstrip that of America’s Marshall Plan, which at $13 billion of funding had neither BRI’s global aspiration nor resources. Though the BRI was launched only in 2013, conservative estimates have China already spending $400 billion on it, with hundreds of millions more in the pipeline for projects with some 86 countries and international organizations, most recently including the first G-7 member, Italy.

Though the BRI is a development scheme, its political and security benefits for China grow increasingly clear, whether through EU members who oppose human rights statements against Beijing or African or Middle Eastern countries who will be less likely over time to provide U.S. forces military access.

Finally, a growing number of experts believe China on current trajectories wants to fill America’s shoes as the dominant global agenda setter and rulemaker.

Bradley A. Thayer and John M. Friend, authors of the 2018 book “How China Sees the World,” write: “By 2049, Western-led institutions will remain, but their liberal principles will be diluted by reforms required by Beijing. As China’s economic power increases and more countries in both the developed and developing world become dependent on Chinese trade and investment, Beijing will use its economic statecraft to pressure countries to downplay or abandon their democratic values and liberal policies.”

By then, their relative resources will provide them far greater leverage.

If China reaches its stated development goals for the centennial of the Communist Party in 2021 and then the centennial of the People’s Republic in 2049, its economy will be 40% larger than the U.S. economy by the first date and three times larger by the second date, measured by purchasing power parity.

With stakes that high, the secondary questions are crucial. Does Beijing have the wherewithal to achieve such lofty aims, and can the U.S. and Europe alter that trajectory?

The answer to both questions is yes, but …

Chinese leaders’ reawakened sense of destiny is a much more overpowering force than is generally understood in Washington, D.C. Financial markets and Western political capitals are littered with those who have underestimated the durability of China’s rise.

That said, China’s slowing economy, the loss of manufacturing jobs, and its increasingly autocratic system introduces new vulnerabilities. There’s a higher level of grumbling among its business elites, political class and foreign investors.

Given the choice, most countries in the world still would rather navigate a world order where the United States is the dominant actor rather than China.

For that to be an option, however, the U.S. and Europe will have to change course in three respects.

First, they will have to address domestic challenges that have made their democratic and economic models less appealing globally. They will have to reinvigorate and, in some cases, reinvent the multilateral systems they and others created after World War II. Finally, they must find a way to act together to more intensively and more effectively engage with China to shape the future — collaborating with China where possible and competing where necessary.

As it’s now clear what China wants, a coordinated U.S. and European response grows more urgent.

Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United States’ most influential think tanks on global affairs. He worked at The Wall Street Journal for more than 25 years as a foreign correspondent, assistant managing editor and as the longest-serving editor of the paper’s European edition. His latest book — “Berlin 1961: Kennedy, Khrushchev, and the Most Dangerous Place on Earth” — was a New York Times best-seller and has been published in more than a dozen languages. Follow him on Twitter @FredKempe and subscribe here to Inflection Points, his look each Saturday at the past week’s top stories and trends.

For more insight from CNBC contributors, follow @CNBCopinion on Twitter.


Company: cnbc, Activity: cnbc, Date: 2019-04-12  Authors: fred kempe, xinhua news agency, getty images
Keywords: news, cnbc, companies, sort, beijing, global, wants, build, european, europe, states, china, countries, ask, chinas, commentary, united, world


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