China and U.S. to hold trade talks next week

BEIJING Fri Dec 13, 2013 5:20am EST

U.S. Treasury Secretary Jack Lew (L) shakes hands with Chinese Vice Premier Wang Yang as they arrive for a meeting at the Diaoyutai State Guesthouse in Beijing November 15, 2013. REUTERS/Andy Wong/Pool

U.S. Treasury Secretary Jack Lew (L) shakes hands with Chinese Vice Premier Wang Yang as they arrive for a meeting at the Diaoyutai State Guesthouse in Beijing November 15, 2013.

Credit: Reuters/Andy Wong/Pool

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BEIJING (Reuters) - Senior U.S. and Chinese officials will hold annual trade talks in Beijing next week, China's Foreign Ministry said on Friday, as the world's two largest economies try to iron out an array of long-held tensions.

Chinese Vice Premier Wang Yang will host U.S. Secretary of Commerce Penny Pritzker and Trade Representative Michael Froman for the Joint Commission on Commerce and Trade (JCCT) on December 19-20, ministry spokesman Hong Lei told a press briefing.

U.S. politicians are eager to attract Chinese investment as a source of new jobs and economic growth, though high-profile Chinese projects have been scrapped after running into national security concerns.

Officials cited food safety worries in a review of the acquisition of the world's largest pork producer, Smithfield Foods Inc, by China's Shuanghui International Holdings Ltd, though the deal received U.S. approval in September.

China makes perennial pledges to address U.S. concerns about widespread piracy and counterfeiting of American-made goods, and Beijing has long pressed the United States to ease its restrictions on exports of high-technology goods.

The two countries agreed to restart stalled negotiations on an investment treaty this summer after China said it would drop blanket restrictions on talks for market access in industries, especially in its service sector.

The United States recorded a $315 billion trade deficit with China in 2012.

The JCCT is an annual forum launched in 1983 for the two countries to address trade and investment issues.

(Reporting by Michael Martina and Ben Blanchard; Editing by Nick Macfie)

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Comments (3)
Pete_Murphy wrote:
America’s massive trade deficit with China is a direct consequence of the inverse relationship between population density and per capita consumption. With a population density four times that of the U.S., China’s market is stunted by severe overcrowding. People living in such crowded conditions simply cannot utilize space-intensive products which, to a greater or lesser extent, describes nearly every product except food and clothing.

When two nations so grossly disparate in population density combine their economies through free trade, the work of manufacturing is spread evenly across the combined labor force. With 80% of the China-U.S. population, 80% of manufacturing jobs now reside in China. That wouldn’t be a problem if China accounted for 80% of the consumption of those products. But they don’t – can’t – never will. Their population density makes that impossible.

Free trade with badly overpopulated nations is a sure-fire loser for the U.S., as proven by our trade results with other such nations like Japan, Germany, Korea, Taiwan and a host of others. In 2011, with the half of nations below the world’s median population density, the U.S. enjoyed a surplus of trade in manufactured products of $153 billion. But with the half of nations above the median population density, the U.S. suffered a deficit of $577 billion.

The only way to assure a balance of trade with overcrowded nations is through the use of tariffs to offset their inability to provide the U.S. access to comparable markets.

Pete Murphy
Author, “Five Short Blasts”

Dec 13, 2013 7:04am EST  --  Report as abuse
tomhe wrote:
@Pete_Murphy
You seem never examine your own assumptions. Mobile communication and car are designed for loosely distributed population. But Chinese use them a lot. Refine your assumptions.

Dec 13, 2013 7:32am EST  --  Report as abuse
Cylon68 wrote:
What is the point for these negotiations, really? They are merely perfunctory exercises designed for the U.S. government to say that they are pressing China on certain issues. They also allow China to say that they are listening to U.S. concerns. Despite all of these years of negotiations and talks, the Yuan is still undervalued, theft of U.S. intellectual property by Chinese actors is rampant, millions of well-paid jobs have been lost, and the U.S. maintains the largest trade deficit in the history of mankind with China. It’s clear that the free market/free trade model that U.S. politicians perennially champion has sever deficiencies when competing with countries employing the state guided, mercantilist model. The results of decades of dumb economic policies are evident everywhere: high unemployment, a preponderance of low-wage service sector jobs, chronic trade deficits, stagnant or declining wages, and declining middle class. U.S. multinationals are reaping the benefits of the global trading system while the prosperity of the middle and lower classes is being eroded by these policies. The sooner the U.S. realizes this and changes course, the better.

Dec 14, 2013 10:20am EST  --  Report as abuse
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