According to former Chinese finance minister Lou Jiwei, even if Joe Biden becomes president of the United States replacing Donald Trump, there would likely be no easing of the trade war between the US and China at least in the near term.
These remarks by Lou were made during the Caixin Summit in Beijing. Currently he serves as a member of a consultative body to the Chinese parliament after he retired.
The news that Biden had clinched enough votes to win last week’s election propped up stock markets in China and in other parts of Asia on Monday. This was on the hopes of easing of the tensions in the frosty Sino-American relationship.
But President Donald Trump has not yet conceded defeat.
“Even if Biden is elected, the U.S. suppression of China will be inevitable,” the outspoken former minister Lou said when asked about the outlook for the U.S.-China economic and trade relationship.
Since the position of the US dollar is positioned as the dominant global currency, therefore it is difficult for the US to cut its trade deficit, Lou said while calling for greater pragmatism in US-China trade relations.
“After four years, the trade deficit (with China) is still widening. We need to return to common sense and return to science. Everyone needs to be reasonable,” said Lou.
Demanding that China should make sweeping structural reforms to open its markets and make more purchase of goods form the United States, a trade war initiated against China by Trump in the middle of 2018.
Tariffs affecting billions of dollars worth of goods have since then been imposed by both the countries which has rattled the global supply chains.
But if Trump happens to remain in Office, he would be cautiously optimistic about trade relations between the US and China, Lou said.
A change in the manner in which developing countries are designated by the World Trade Organization has also been demanded by Trump, who has complained that unfair advantage of their status as developing economies under WTO rules have been taken up countries like China as the rules permit them to keep a higher import tariff as well as impose other trade barriers.
The Geneva-based body is currently seeking to find its next director-general after Brazil’s Roberto Azevedo stepped down W year early in August.
With globalization facing a crisis, a reform of multinational organisations especially WTO has been urged to be implemented by Nicolas Chapuis, ambassador of the European Union to China.
Chapuis said at the Caixin Summit that China should advance from its current WTO status as a developing nation and play a bigger role.
“China in WTO today is not the China in WTO in 2001,” Chapuis said.
“We expect China to come up with ideas, suggestions, and that we overcome the present obstacles of China defining itself as a developing country.”
(Adapted from Reuters.com)