Trump's trade war with China is over for now. China won

Trump's trade war with China is over for now. China won

Most Republicans don't want a trade war, remember; they're not protectionists, even if they sympathize with Trump in wanting to punish China for stealing USA intellectual property. But consensus is emerging that the president is losing the first battles. At one point, the President abruptly transitioned from discussing US-China trade issues to airing his concerns about Chinese influence over North Korea.

Now the conflict has Mr Trump taking fire at home from two sides: those anxious he is provoking a damaging trade fight, and those who fear he will give in too easily.

Washington and Beijing both claimed victory in trade talks on Monday as the world's two largest economies agreed to hold further talks to boost USA exports to China.

But amid the sound and fury, what, if anything, is actually changing?

The US Commerce Department imposed sanctions on ZTE in April after determining that the Chinese firm had broken an agreement in relation to a ban on shipping goods and technology to Iran.

On Tuesday, Trump said a resolution of the ZTE sanctions would also help USA companies that supply the Chinese firm: ZTE "can pay a big price without necessarily damaging all these American companies. you're talking about tremendous amounts of money and jobs to American companies". The measures have forced the firm, which relies on USA parts to make smart phones and network equipment, to suspend major operations.

Ilan Goldenberg, the director of the Middle East Security Program at the Center for a New American Security, also took the Trump team to task over the negotiations.

US Treasury Secretary Steven Mnuchin said earlier on Tuesday that the US did not mean to "put ZTE out of business".

"I can assure you that whatever the Commerce Department decides, the intel community has been part of the briefings and we will ensure that we enforce national security issues", Mnuchin said. He took to Twitter to defend his action. It was not immediately clear whether he was referring to ZTE or broader trade negotiations.

"Those were not part of our discussions", Mnuchin said, in apparent contradiction of earlier administration indications that the United States was prepared to discuss all the trade issues tabled during the escalating dispute. More important, it confronts structural issues relating to its growing massive fiscal deficit, declining exports, dependence on U.S. exports, its mountain of debt, the distrust it has generated in foreign enterprises.

"We can do a 301, where we dont need China, where we can just say, Look, this is what we want. this is what we think is fair".

Meanwhile, China has achieved important objectives, both tangible and intangible.

Washington and Beijing stepped back from the brink of full-blown trade war after talks last week, with the United States appearing to set aside for now its demands that China revamp key planks of its industrial policy in exchange for buying more farm products. Tariffs for auto parts would be cut to 6 percent from mostly about 10 percent.

On Tuesday, Bloomberg reported that discord over a China strategy was behind the administration's decision to put the imposition of tariffs on hold.

But while American officials played a good cop-bad cop routine and continued to debate amongst themselves, the Chinese media claimed victory.

"We never anticipated one". China on Tuesday made a conciliatory gesture by cutting the tariff on imported vehicles to 15 percent from 25 percent, effective July 1. "It's a matter of sending a message about how strongly we feel about national defense and about a telecommunication company and how critical that is to national infrastructure but I do not see it as a rebuke". China responded aggressively with tariffs of its own and now POTUS is in a bind, not wanting to cave and look weak but also knowing that digging in really could risk a full-blown trade war and ruin the chances of dialogue with North Korea.

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