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Trump is urged to drop confrontation

By WANG QINGYUN and LIU XUAN in Beijing and CHEN WEIHUA in Washington | China Daily | Updated: 2018-02-01 05:19

China urged the United States on Wednesday to abandon a Cold War mentality and zero-sum thinking, as US President Donald Trump labeled China and Russia "rivals" that threaten US values in his first State of the Union address.

"Around the world, we face rogue regimes, terrorist groups and rivals like China and Russia that challenge our interests, our economy and our values," Trump told Congress on Tuesday.

"In confronting these dangers, we know that weakness is the surest path to conflict, and unmatched power is the surest means of our defense."

Chinese Foreign Ministry spokeswoman Hua Chunying said, "Both history and reality have proved that cooperation is the only right choice for China and the United States, and that a better future can be achieved only through mutual benefit."

The two countries share "wide and important" common interests, which are "far greater" than their differences, Hua said.

The US should also work with China to focus on cooperation and manage differences in order to maintain the healthy and stable development of bilateral ties, she added.

Trump also blasted unfair trade deals and accused the world of taking advantage of Washington on trade.

He said the United States has finally turned the page on decades of unfair trade deals that sacrificed US prosperity and shipped away companies, jobs and the nation's wealth.

"Our nation has lost its wealth, but we are getting it back so fast. The era of economic surrender is over," Trump said.

He said the US will work to fix bad trade deals and negotiate new ones.

In his first year in office, Trump has withdrawn the US from the Trans-Pacific Partnership and threatened to pull out of the North American Free Trade Agreement and US-Korea Free Trade Agreement if other parties involved — Mexico, Canada and South Korea — do not make unilateral concessions.

His administration also has initiated a Section 301 investigation into China's intellectual property policy and practices, using the 1974 US Trade Act, which is inconsistent with World Trade Organization principles.

Last week, Trump signed orders for new tariffs on imported solar cells and washing machines, drawing protests from the US solar industry, lawmakers and US trade partners such as China, South Korea and Germany.

"So far America First has looked like America Alone," James Goldgeier, a professor of international relations at American University in Washington, said ahead of Trump's speech.

Wayne Morrison, a specialist in Asian trade and finance at the Congressional Research Service, which serves the US Congress, said the Trump administration appears to be taking a hard line on trade with many of its trading partners by boosting enforcement of US trade remedy measures, dusting off old US trade laws, pulling out of trade agreements and renegotiating others, and talking tough on trade imbalances.

He said attempting to act unilaterally could prove risky even though the US has many legitimate complaints about unfair foreign trade barriers and inadequate protection of US intellectual property rights.

"It could undermine the rules-based multilateral trading system, hurt relations with friends and allies, lead to retaliation and counter-retaliation with trading partners and diminish the attractiveness of the United States as a potential free trade-agreement partner," Morrison told China Daily.

"Ultimately, such policies could result in diminished trade, which would be bad for all," he said.

He Ning, a former minister for trade and economic affairs at the Chinese embassy in the US, said there would not be a trade war between the US and China because of existing multilateral trade rules, but he thinks the two countries will have to deal with trade disputes.

"When looking at disputes, people always look at the absolute value of the amount involved. But we should also look at the proportion. Thus, on a large scale, Sino-US trade relations are relatively normal when the proportion takes only 3 to 5 percent," he said.

The trade deficit between China and the US reflects the flow of goods but does not reflect the flow of profits, He said. "Most of the profit still goes to the US. This also explains why the US is still willing to trade with China under the existing deficit."

Michael Froman, US trade representative under the Obama administration, also expressed concern about the Trump administration acting outside of the international system.

"I think one of the things we need to watch out for is that the Trump administration is not undermining the WTO dispute-settlement body," he said in a talk at Harvard University.

Froman said that if the "US is picking and choosing which international obligation it's going to abide by, we are giving a license to other countries, not just to retaliate against us, but to imitate us".

Indian Prime Minister Narendra Modi and German Chancellor Angela Merkel both delivered a veiled criticism of growing US protectionism and isolationism during the World Economic Forum in Davos last week, although they did not call out the US by name.

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