By MATTHEW PENNINGTON, Associated Press
WASHINGTON (AP) — President Donald Trump first tried to disarm Chinese President Xi Jinping at Mar-a-Lago with smooth talk and hospitality. A year later, he’s resorted to hardball and found that Xi is willing to throw it back.
The growing acrimony over trade is deepening mistrust between the two governments and roiling global markets. But at least for now, it is unlikely to spill over into sensitive national security issues, former U.S. officials and China experts say.
China has no interest in escalating the dispute over tariffs and wants to reach a trade compromise with the U.S., they say. The White House also says it hopes differences can be mended through negotiations. But when Trump on Thursday doubled down on his threat to tax Chinese imports, the path to resolution appeared to narrow. China vowed Friday to “counterattack with great strength” and said negotiations were impossible under current conditions.
So far, both sides have outlined plans for $50 billion in tariffs on each other’s exports. On Thursday, Trump said he had instructed the U.S. trade representative to consider imposing $100 billion in additional tariffs on Chinese goods, despite opposition from some of his supporters who could be hit hard by a trade war.
“The Chinese have to assume that Trump is willing to go through with this,” said Bonnie Glaser, senior adviser for Asia at the Center for Strategic and International Studies, “but at the same time, a lot of it just seems he’s trying to get leverage to force the Chinese to give him a better deal” to dramatically reduce the U.S. trade deficit with China.
The barrage of tough rhetoric belies a personal rapport forged between Trump and Xi when they met at his Florida resort last April 6-7, when Trump sought Xi’s help on North Korea and on trade.
China has cooperated to an unexpected degree on North Korea by agreeing to and applying international sanctions to punish its wayward ally for developing nuclear weapons. Trump has often praised Xi for that — rhetoric that is welcomed in China’s authoritarian political system, where great importance is vested in leadership ties.
But in recent months, Washington has adopted an increasingly adversarial stance toward Beijing, and not just on trade. That trend could be intensified as Trump replaces moderates in his administration with hawks such as incoming national security adviser John Bolton, who has advocated a tougher approach toward China.
“The relationship is spiraling downwards, and the risk of a miscalculation or accident is only increasing,” wrote Elizabeth Economy, director for Asia studies at the Council on Foreign Relations.
In December, the Trump administration adopted a national security strategy that identified China, along with Russia, as a “revisionist power” intent on challenging American interests. The U.S. has ruffled Beijing’s feathers by stepping up the tempo of naval operations in the South China Sea. And Trump signed legislation last month that calls for Cabinet-level official visits to Taiwan, a self-governing island that Beijing regards as part of Chinese territory.
Doug Paal, who handled Asian affairs at the White House under the Republican administrations of Ronald Reagan and George H. W. Bush, said China views this as a gambit by Trump to exact concessions on trade. Speaking earlier this week, Paal said it hasn’t undermined China’s belief that Trump, who has avoided criticizing China on human rights, is someone they can work with.
But Daniel Russel, who was President Barack Obama’s point man on Asia, said Trump’s trade gambit was playing into the Chinese perception of the U.S. as a malevolent rival bent on containing China’s rise as a world power.
“The Chinese know how to play this game and have had abundant time to prepare a counterstrike strategy. It includes grabbing the moral high ground and getting other countries to look at China as a victim, not the offender, and as the defender of the international trading system,” he said. “It is a ridiculous turn of events.”
Under Obama, the U.S. exacted an agreement from China that reduced — but did not halt — cybertheft of U.S. commercial secrets. The U.S failed to narrow the trade deficit with China, which hit a record $337.2 billion last year.
“We chose not to blow up the relationship,” said Russel, now at the New York-based Asia Society Policy Institute. “We chose not to put the global economy at risk through some sort of suicide-vest type of challenge.”
Compromise on the trade dispute remains possible. The U.S. tariffs won’t take effect for about two months, and China says it is waiting to see what Washington does.
“What we are seeing so far, although it’s ugly and it’s confrontational, it’s still posturing,” said Yun Sun, China expert at the Stimson Center think tank. “We have not yet seen the ax falling.”
She said the differences go beyond the level of import taxes: It’s also about ascendancy in the high-technology economy, where China seeks global leadership in electric cars, robotics and other fields.
“Trump has made clear he wants to strike deals, but the bar is so high that the Chinese don’t know whether they can meet it,” Yun said.