Bloomberg reported citing a “person familiar with the situation” regarding US-China trade tension. That “person” said China Vice Premier Liu He rejected US request to stop subsidizing business related to its “Made in China 2025” initiative.
Request from the US came after China offered to lower it’s trade surplus to US by USD 50b. And that would be done by China buy more liquefied natural gas, agricultural products, semiconductors and luxury goods from the US. China’s proposal also include opening the financial sector at a faster pace, giving US companies more access to the e-commerce markets.
In addition, that “person” said Liu said that President Xi Jinping is ready to fight back in Trump wants a trade war. And China is open to talks but won’t initiate it.
It’s yet another Bloomberg report with information from a “person”. Bloomberg didn’t even specify that it’s from a Chinese government official. So, there is no way for us to judge whether is information is indeed from the US or from China. Even so, is it something that leaked, or made up, from Trump’s own team?
For now, we don’t believe that China has offered to cut the surplus to US by USD 50b. There is no urgency for China to offer anything. It takes from now to May 22 for Trump to collect public input on the tariffs on that USD 50b. What will the end-list be? It’s a big unknown, not to mention that list of USD 100b of goods. Even if China would offer something eventually, would Xi want to drag the negotiation beyond the mid-term election in the US?