Trade relations between US and China may not improve, even after Biden takes up charge at the White House, says former Chinese Finance Minister Lou Jiwei. Lou is now retired and is a member of the consultative body to the Chinese parliament. Lou has made the remarks at Caixin Summit event in Beijing.
He has given his views on the matter, after being asked about the economic and trade relations between the US and China. The US suppression over China is inevitable, this is what Lou has said. Lou says, that its very difficult for the US, to cut off its trade deficit, due to the dollar’s global positioning. The trade deficit seems to be increasing every minute.
Going by past reports, the Trump administration launched a trade war in 2018 itself. In the statement, Trump asked China to reform its open markets and purchase more from the US. Since that time, both countries have imposed heavy tariffs that have affected billions of goods. It has sent shockwaves across global supply chains.
Decision Of Trump Regarding Trade Relations
Recently, Trump had called for changes in how the World Trade Organization designates all developing countries. He further added that countries like China take undue advantage of the same. They are said to have maintained a higher tariff and also erected various trade barriers.
Lou also said, that he would have been optimistic if President Donald Trump still held office. Lou further added that it was the time to study China’s exit from the accommodative monetary policy. However, ousting China from fiscal stimulus strategy was not on point.
Liu Guoqiang, a vice governor of the People’s Bank of China has said last week, that the central bank should consider policy changes as soon as possible. This can indicate an improvement in the relations. The economy looks all set to revise, as the no work no earnings does not hold good. However, he had further added, that the government should study the policy and then go for further changes.
Opinion Of The Experts
Lou further added that all financial decisions ought to be taken after careful deliberation. Nicolas Chapuis, who is the ambassador of the EU to China urged the organization to start reforming its policies. He had especially urged WTO to take action against China’s bad policies. They tend to favor the country most, against other oppressive policies against developing nations.
He also added, that China needs to play a bigger role as a member of WTO. Today, China has come a long way from what it was in 2001. So, it should behave accordingly. He said that China is expected to behave in a more mature manner. Moreover, China should also let the world know, how the other developing nations around the globe should grow. It should act as a role model for other countries. The WTO should thus change its policies of leniency from China. Checking out the trade relations with the country is really important in this scenario.
In February 2020, the Trump administration had removed China along with some other nations from the U.S list of developing nations. Subsidies should be kept for real developing nations, and not an already developed nation like China. Thus there