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MNI EXCLUSIVE: Extension Over Concessions For China: Advisors


By Iris Ouyang

BEIJING (MNI) - China may prefer to extend trade talks with the U.S rather than offer too many concessions to Washington's demands, as conceding ground could be worse than any additional tariffs, advisors to the government have told MNI.

"For China, the worst case is not that (U.S. President) Trump slaps on tariffs, but in making too many concessions because of concerns over them," said Yu Miaojie, a veteran trade expert who advises Chinese government departments.

Yu's comments came as China appears to be taking a tougher stance against increasing demands from the U.S. administration now accusing China of reneging on previous commitments.

Others agreed that China could not lower its status in talks. "If they want us to be subordinate, we can't do that, because the U.S. will again and again demand more if we did so," Liu Hong, a director of the Ministry of Commerce's China Association of International Trade told MNI.


A turn in the recent optimistic dynamics of the talks has not come as a surprise to many China government advisors whotold MNI that they have long predicted such an outcome and the Beijing has backup plans for such situation.

Their viewpoints echo Beijing's official response, with the Ministry of Commerce stressing China can counter any outcome from the trade talks, while restating there will be retaliatory measures if the U.S. increase tariffs on some Chinese goods Friday.

According to advisors, China could increase its retaliatory tariffs on $60 billion American goods to 25% from the current 10%, whilst also cancelling promises to the U.S. for increased purchases, lowering car tariffs and further opening up of the service sector.


The U.S. plan to implement the new tariffs at 0401GMT Friday, despite China's senior trade delegate Vice Premier Liu He being in Washington for talks, leaving little time for advances. But advisors tend to view President Trump as less likely to proceed with the plan although they also recognize there is some chances.

Yu said the chance for the 25% tariff hike to take effect on Friday is relatively low, as normal procedure would require the Trump administration to seek approval from Congress before full implementation.

"I don't mean they won't implement it at all, they may do that in half a month or a month after going through the procedures," Yu told MNI.

But even if Trump did push through an increase, China shouldn't immediately make too many compromises, as Congress could reverse the move in the next few weeks, Yu said.