The Chinese Foreign Ministry said that the Chinese government had not called United States negotiators, challenging President Donald Trump's claim that the two countries had been in contact over the weekend and that Beijing had indicated a desire to resume trade negotiations.
"China called last night our top trade people and said 'let's get back to the table' so we will be getting back to the table and I think they want to do something. They have been hurt very badly but they understand this is the right thing to do and I have great respect for it. This is a very positive development for the world," Trump said while speaking at the G-7 Summit in Biarritz, France, on Monday.
Although Trump said on Sunday that "we are getting along very well with China right now," Beijing offered a less rosy depiction of the status of negotiations. And the Chinese government said on bothas Monday and Tuesday that the two sides had not spoken.
"I have not heard of this situation regarding the two calls that the U.S. mentioned in the weekend," Foreign Ministry spokesman Geng Shuang said on Tuesday, reiterating remarks on Monday that the call had not taken place. Shuang also rebuked the U.S. for announcing tariff hikes on more imports from China.
Despite Trump's claim that trade wars are easy to win. China hasn't shown signs of capitulating.
Analysts from Bank of America Merrill Lynch said in a Monday note that China's recent tariff retaliation showed Beijing was prepared to endure the financial pain of the trade war.
China said Friday it would place duties on $75 billion of American exports in retaliation for Trump's announcement he would levy new tariffs on Chinese imports starting September 1. Beginning next month, oil imported from the U.S. will be subjected to a 5 percent tariff. China only purchased a fraction of its oil from the U.S. during first half of the year – 120,000 barrels per day out of a total 9.87 million imported – but the tariff would still hurt oil-related businesses.
"Imposing a tariff on U.S. crude is an act of self-harm on three fronts," Bank of America Merrill Lynch analysts wrote in the note, saying that the tariff would impact domestic refineries and reduce the competitiveness of petroleum product exporters. "Thus, the latest round of tariffs suggests China's pain threshold is higher than the market has assumed so far."
Both governments have insisted they won't capitulate in the trade war, and global uncertainty driven by the trade war has stoked fears of a potential recession.
Trump has sought to dismiss worries about the economy and repeatedly criticized the Federal Reserve, but if a recession comes, he will have trouble avoiding responsibility for a trade war he has driven.
The president has guided the tariff escalations of the trade war. China has responded to Trump by issuing its own tariffs, but the nation has taken a more measured approach to the trade war, according to recent analysis from Chad Bown, an economist at the Peterson Institute for International Economics.
While, with the newest announcement of tariffs, Trump will have slated duties for all Chinese imports, Beijing has not announced or levied duties on almost a third of goods that the U.S. exports to China.
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
About the writer
Daniel Moritz-Rabson is a breaking news reporter for Newsweek based in New York. Before joining Newsweek Daniel interned at PBS NewsHour ... Read more
