Commerce Secretary Wilbur Ross Outlines Goals for This Week’s China Trade Trip

Cathalijne Adams Researcher, Alliance for American Manufacturing

The Trump administration’s U.S.-China trade delegation will likely address both intellectual property rights as well as steel and aluminum trade issues during the delegation’s visit to China this week, said Commerce Secretary Wilbur Ross.

Speaking at the annual Society for Advancing Business Editing and Writing (SABEW) conference in Washington on Friday, Ross said that President Trump views America’s concerns about intellectual property rights as linked to the threats posed by China’s state-subsidized steel and aluminum industries, and that Trump believes that both trade issues must be addressed to restore fair trade with China.

“Where there’s a sort of commonality of interest between the two 232s and the 301 is this — things like steel and aluminum deal with the economy as they exist today. Intellectual property rights importantly deal with the economies as they will be in the future,” Ross said. “It’s the president’s view we must deal with both today’s necessities and the future’s necessities.”

Made in China 2025, China’s initiative to lead the world’s advanced manufacturing economy by subsidizing and loaning funds to Chinese manufacturers, is also of concern as the trade delegation prepares for their mission.

Ross observed the damage China’s subsidized steel and aluminum industries have inflicted on America as a harbinger of future consequences should the U.S. fail to address “China 2025."

“Historically, they have subsidized the traditional industries: the steels, the aluminums, things like that, shipbuilding and others. What the [China 2025] plan seems to call for is major subsidies, hundreds of billions of dollars of subsidies, for the industries of the future, but we already have seen the problem that subsidies have created for the more traditional industries,” Ross said.

“Is it fair competition for America’s high-tech companies or Europe’s or Japan’s or anyone else’s to compete against a state that is advancing hundreds of billions of dollars of subsidies for those industries? Leaving aside all the intellectual property rights, just the idea of the subsidies, that is troubling.”

Despite concerns that the tariffs imposed by Trump will spur a trade war, Ross expressed optimism that China is ready to negotiate.

“There’s some encouragement from some of the recent remarks by President Xi, particularly at the Boao Conference. He suggested there quite a lot of things that if fleshed out and if they were tightly timed and nominated, they could be very promising,” Ross said.

Also on the agenda for the U.S. trade delegation will be disproportionate tariffs imposed by China to solely foster their own industries and limit the growth of other nations.

"Our goal in terms of the relations with China is no different than what it has been – to get rid of the abusive tactics, especially in the intellectual property rights area but also in the tariff barriers. Take automotive. China is not now an exporter much in the way of automobiles to us, but right now their tariff barrier is 25 percent versus our 2.5,” Ross said. “It’s pretty clear that China intends to become a global player in electric vehicles and perhaps in autonomous vehicles as well.”

Currently, Ross is not scheduled to personally attend the U.S. trade delegation’s talks with China.

But Ross affirmed that “there will be a unified policy at the meeting,” addressing concerns that the U.S. trade delegation to China, which will include U.S. Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin, Office of Trade and Manufacturing Policy Director Peter Navarro, and White House Economic Adviser Larry Kudlow, represents dissident perspectives on trade.


Reposted from AAM

Posted In: Allied Approaches, From Alliance for American Manufacturing

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