US-China Trade Negotiations Need to Show Sincerity and Reasonable Expections, to Save Lobster and Other Industries By Shi Xiaomeng, Xinhua writers Sun Ding, and Hu Yousong Editor: huaxia Xinhua, July 30, 2019

A worker sorts lobsters by size at Maine Coast Lobster Company in York, Maine, the United States, June 26, 201

 

U.S. negotiators need to show sincerity, reason at Shanghai talks

By Shi Xiaomeng

Xinhua, Editor: huaxia

Negotiators from China and the United States are relaunching consultations to fix their strained trade relations on Tuesday in Shanghai.

It is the first formal sit-down between the two negotiating teams after their trade talks hit a wall in May and were brought back on track during a meeting between Chinese President Xi Jinping and his U.S. counterpart, Donald Trump, on the sidelines of the Group of 20 summit held in the Japanese city of Osaka in June.

After the summit, the delegations of the two countries have maintained contact. Chinese Vice Premier Liu He talked with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin twice over the phone before the two sides decided to relaunch their trade consultations in Shanghai.

It is also the first time that they held the trade talks outside their capital cities, and Shanghai, venue for this new round of consultations, has its special place in the history of China-U.S. relations.

In 1972, when then U.S. President Richard Nixon paid an ice-breaking visit to China, the two sides issued the "Shanghai Communique" in the sincere hope of normalizing bilateral ties after more than two decades of estrangement.

Today once again in the metropolis of Shanghai, U.S. negotiators need to demonstrate that same sincerity and, more importantly, reasonable expectations in the relaunched trade talks with their Chinese counterparts in a bid to normalize bilateral trade relations.

For more than a year, China and the United States, in a bid to settle their trade disputes, have held 11 rounds of high-level talks, during which Beijing has demonstrated its utmost sincerity to overcome differences between the two sides in pursuit of an agreement that can satisfy both.

However, some U.S. trade hawks have chosen to turn a blind eye to China's legitimate interests and put forward unrealistic demands that infringe upon China's sovereignty and dignity. China-bashers like Steven Bannon even tried to ride the waves of the tariff war to hype up anti-China sentiment and contain China's development. These provocative actions ultimately led to an impasse in dialogue.

In the ongoing round of trade talks, the U.S. side needs to engage in consultations on the basis of equality and treat China with due respect if it wants a trade deal. However, if Washington still holds the illusion that Beijing will somehow cave in and compromise on issues concerning sovereignty and other related core interests to reach a deal, then no deal is fine. China will always find a way to withstand any pressure.

The economic and trade cooperation between China and the United States is mutually beneficial in nature. And as Washington is trying to wage a tariff war against China, it is hurting its own economy and people. According to research conducted by economists from the New York Federal Reserve and Princeton and Columbia universities, the tariff war cost American companies and consumers 4.4 billion U.S. dollars a month in 2018.

Moreover, as trade disputes linger, the world economy is suffering as well. Morgan Stanley's chief economist Chetan Ahya has said, "As uncertainty around trade policy is unresolved, the impact on the growth outlook is becoming more pronounced."

For the benefit of both sides and the world at large, China and the United States need to cherish the hard-won resumption of trade talks and accommodate each other's core interests so as to pave the way for an early deal.

Forty-seven years ago, "the Shanghai Communique" has shown the courage of the leaders of the two countries to come together over huge ideological gaps for not only the interests of the two peoples, but also the easing of tensions in the world. It is hoped that this time, the Chinese and U.S. trade negotiators can pluck up some courage as their predecessors did and work together for sturdier and more fruitful bilateral trade relations.

www.xinhuanet.com/english/2019-07/30/c_138268727.htm 

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U.S. lobster industry bogged down after losing Chinese market in trade tensions

 by Xinhua writers Sun Ding, Hu Yousong

Xinhua, Editor: huaxia

Video editor: Ma Ruxuan

* Due to the ongoing trade tensions that Washington initiated with Beijing more than a year ago, Mortillaro is now back to where he was by losing his promising Chinese business as the U.S. lobster industry is bogged down by extra tariffs.

* "We're in a situation as all other American companies are. We are all looking for alternative buyers and we are beating ourselves to death...Who's ever going to get the business is the cheaper price."

* Maine's lobster exports to China have subsequently plunged 84 percent since China was forced to impose retaliatory tariffs, data released by the Maine International Trade Center earlier this year showed.

*While the short-term impact is already difficult to endure, many U.S. lobster dealers, including Mortillaro, are worried that their former Chinese customers have forged new business relationships with Canadian lobster dealers and that they would lose their business with China in the long term if not permanently.

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Good wine needs no bush. If you have good lobsters, buyers -- even from the other side of the planet -- will find ways reaching out to you.

This was the case for U.S. lobster dealer Vince Mortillaro as Chinese buyers were easily impressed by the fine quality of his live lobsters. The Gloucester, Massachusetts-based family business experienced a strong boost in sales when it started conducting business with China, one of the world's largest lobster markets.

However, due to the ongoing trade tensions that Washington initiated with Beijing more than a year ago, Mortillaro is now back to where he was by losing his promising Chinese business as the U.S. lobster industry is bogged down by extra tariffs.

As U.S. and Chinese trade officials are returning back to the negotiation table on Tuesday, Mortillaro is eager to see an early end to the trade tensions and his business with China go "back to normal."

TOUGH SITUATION

In July 2018, the United States unilaterally imposed additional tariffs on a group of Chinese imports, initiating widely-unexpected trade disputes with China, and jeopardizing a wide range of industries which have been nourished by trade contacts between the world's two largest economies.

"In China, we can't get any business," Mortillaro told Xinhua in a recent interview.

Mortillaro used to ship lobsters regularly to major Chinese cities including Beijing, Shanghai and Guangzhou in the past five years but hasn't been able to in 2019 because Canadian shippers are gaining more price advantages in the competition to woo Chinese customers.

"Canada only has a 7-percent tariff," he said, adding that it is very hard to compete with Canadian exporters under this circumstance since the tariff on U.S. lobsters has been raised to 32 percent due to the U.S. tariff tensions with China.

The hit was painful: For Mortillaro, who ships approximately 5 million pounds (2.3 million kg) of lobster a year, sales have gone down some 6 million U.S. dollars for the first six months this year, an equivalent of a reduction of 500,000 pounds (226,796 kg) in exports. Meanwhile, jobs were also affected.

"My employees used to work 60 plus hours a week and they now only work 35-40 hours. They couldn't pay their bills. We lost employees because of it. They had to leave for other jobs. We had to lay some people off too because there just wasn't enough hours," Mortillaro said.

Finding alternative buyers overseas to offset losses in the Chinese market is not that easy, as European Union nations, traditional importers of U.S. lobsters, are imposing an 8-percent tariff on them, while they have none on Canadian lobsters, leaving Mortillaro no choice but to try expanding his domestic distribution.

"We're in a situation as all other American companies are. We are all looking for alternative buyers and we are beating ourselves to death," he said. "Who's ever going to get the business is the cheaper price."

WHOLE INDUSTRY FEELING PINCH

Massachusetts is the second largest U.S. state in terms of lobster harvest, falling only behind neighboring Maine, which has been hit harder by the trade tensions.

Prior to the trade disputes, China had become the second largest importer of Maine's lobsters. During 2017 -- the last full year before the tariffs went into effect -- Chinese customers purchased 128.5 million dollars' worth of lobsters from Maine, and during the first half of 2018, U.S. lobster exports to China increased by 169 percent, according to a letter signed by all four members of the state's U.S. Congressional delegation.

As U.S. lobster dealers were encouraged by the trend, the tariff hikes kicked in. Maine's lobster exports to China have subsequently plunged 84 percent since China was forced to impose retaliatory tariffs, data released by the Maine International Trade Center earlier this year showed.

"Maine's lobster industry has worked hard to establish markets in China, which they've lost through no fault of their own. Lobsters are a major piece of Maine's economy -- when this industry hurts, Maine people do, too," Senator Angus King of Maine, an Independent, said on Twitter this month.

While the short-term impact is already difficult to endure, many U.S. lobster dealers, including Mortillaro, are worried that their former Chinese customers have forged new business relationships with Canadian lobster dealers and that they would lose their business with China in the long term if not permanently.

"The longer these tariffs go, the more infrastructure they will be putting (up) in Canada, and then it becomes difficult to get the business back," Mortillaro said. "It took a while to develop it, (so) to get it back is gonna take just as long."

He spoke frankly that he had thought a lot about setting up facilities in Canada, but his age, uncertainties in making investments in another country, and difficulties in finding employees and running an overseas business urged him to call it off.

WE NEED EACH OTHER

Ed Smith, a commercial lobsterman in Gloucester, told Xinhua that he believes that the trade tensions between the United States and China are detrimental to both sides.

"I think China's economy is dependent on us and I think our economy is dependent on China," Smith said. "For both economies to grow, I think we need each other."

Speaking of the trade negotiations between the two sides, he said that "it would be mutually beneficial to find some common ground and move forward instead of putting up a fence."

Beijing announced last week that the 12th round of China-U.S. high-level economic and trade consultations will be held on July 30-31 in Shanghai, nearly two months after the last talks in Washington D.C.

Chief trade negotiators of both sides will meet to implement the important consensus reached by the two heads of state in Osaka, Japan, and hold a new round of consultations on the basis of equality and mutual respect, said Gao Feng, spokesman for China's Ministry of Commerce.

Mortillaro, who has followed the trade talks very closely and keeps track of relevant news almost every day, said that his message is that he would like to see an early end to the trade tensions and his business with China go "back to normal," as the Chinese market is too valuable to lose for him and the rest of the U.S. lobster industry.

"Since the establishment of diplomatic ties between the two countries 40 years ago, the two economies have become closely intertwined and highly integrated, benefiting the people of both countries and the world," Gao said.

The so-called "decoupling" of the two economies is hard to imagine, and is something that people from all walks of life in the United States do not want to see, said the spokesman, urging Washington to do more that is truly beneficial to the two countries and their people.

http://www.xinhuanet.com/english/2019-07/29/c_138267761.htm

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