Why does China still want talks under mounting U.S. pressure?

Editor's note: This article is an edited translation which was first published on Taoran Notes, a Wechat official account platform. The article reflects the author's opinions and not necessarily the views of CGTN.

A new round of China-U.S. trade talks will be held in the United States October 10-11.

Over the past two months, the insistence on maximum pressure by some hawkish U.S. politicians has repeatedly provoked and escalated the China-U.S. tension, which has eased after the Xi-Trump summit in Osaka. This round of consultations is to be held in the absence of a breakthrough in the tariffs' tension and with no sign of the China-U.S. tit-for-tat.

Everyone is very anxious and full of doubts: What is going on at the moment? Why does China still want to talk under so much pressure from the U.S.? What will be the outcome of this round of consultations?

In the past two months or so, the messages sent by both countries were a mixed bag featuring both talk and fight. On the one hand, China has responded accordingly to any attempt by the U.S. to impose additional tariffs on Chinese goods. On the other hand, China has been very conscientious when it comes to specific countermeasures because China has always held the position of "solving disputes through consultation and cooperation in a cool-headed manner."

Since the phone conversation between the Chinese and American team leaders, the consultations have been carried out according to the agreed plan. However, as this round of consultations approaches, the situation remains complicated.

Chinese Vice Premier Liu He (R) and U.S. Treasury Secretary Steven (L) Mnuchin and U.S. Trade Representative Robert Lighthizer (C) take their positions for a photo at Xijiao Conference Center in Shanghai, China, July 31, 2019. /VCG Photo

Chinese Vice Premier Liu He (R) and U.S. Treasury Secretary Steven (L) Mnuchin and U.S. Trade Representative Robert Lighthizer (C) take their positions for a photo at Xijiao Conference Center in Shanghai, China, July 31, 2019. /VCG Photo

For example, lately, some people in the U.S. claimed that China was interfering in domestic U.S. politics. They tried to play the China card when talking about the domestic U.S. issues in order to score some political points. This kind of behavior is tantamount to "making a political headline out of thin air". They saw China's stance on not interfering in other countries' internal affairs as an opportunity to smear China, so they jumped on this political bandwagon to discredit China. Such reckless rhetoric only added to the complexity of the ongoing trade consultations. 

Again, before the start of this round of consultations, despite the welcome gesture from the White House, the U.S. still has not given up the means of maximum pressure. There goes the same old American trick. 

It's worth noting that the U.S. is also facing a complex situation at the sensitive moment of trade consultations. While the escalating tariff tension is causing a negative impact on other countries, it is also inflicting pain on American companies.

According to the survey data released by the U.S.-based Institute of Supply Management on October 1, the U.S. Manufacturing Purchasing Managers Index (PMI) fell sharply to 47.8 in September, the lowest level since June 2009, indicating that the U.S. manufacturing industry has been contracting. This marks the U.S. manufacturing PMI sliding for the second consecutive month. In August, the index was 49.1.

Both China and the United States are willing to move this round of consultations forward. However, in the absence of a breakthrough in the China-U.S. trade standoff, it's only rational for the two sides to temporarily put aside the dispute and seek the greatest consensus.

Only by seeking common ground while shelving differences can both countries truly make a breakthrough in solving the dispute.

Looking ahead at this round of consultations, there are three possible outcomes: reaching a fair deal, collapse of talks, or maintaining the status quo.

If a deal can be reached, everyone is happy. Even if the talks collapses, China is sure to have made a sound contingency plan to cope with that scenario. For the third scenario, some caveat should be in place. There will be some pragmatic issues that need to be pondered. If the U.S. slaps new tariffs on Chinese goods, is it necessary to continue the talk? If countermeasure is taken, is a talk still necessary?

The answer is, "Yes."

Countermeasures and talks are both necessary for good reasons. Both hardline response and trade talks are the means of defending national interests rather than a game of chicken. Action shouldn't be taken for any short-term gains.

The U.S. dares to provoke a trade war largely because it has a big economy and enjoys a unique status in the global economy. This is very clear in that the U.S. always pushes China while China is on the defense and only takes countermeasures if necessary.

So, does it mean that we are completely passive?

Not really.

Although forced to fight, China did not give up its initiative. We are doing two things. On the one hand, China is minding its business at home and pushing the Chinese economy to a new stage of high-quality development through further reform and opening up. On the other hand, through an integrated strategy of negotiation, defense, and countermeasure, China intends to let the U.S. also feel the pain inflicted by the trade war and tell the U.S. a simple fact that "there is no winner in a trade war".

There is no shortcut. What China can do is to move towards its goals one step at a time while staying calm and face all kinds of complex situations with composure.

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