Published: Wed, April 11, 2018
Money | By Hannah Jacobs

China's President Promises To Cut Auto Import Tariff, Files US Tariff Complaint

China's President Promises To Cut Auto Import Tariff, Files US Tariff Complaint

So, if import duties are slashed, prices will reduce and, in turn, help further sales.

US President Donald Trump, however, praised Xi's "kind words" on reform on Tuesday and pledged to cooperate with China toward "great progress" in resolving trade differences.

ENERGY: Benchmark U.S. crude shed 25 cents to $65.26 per barrel in electronic trading on the New York Mercantile Exchange.

Promising a "new phase of opening up", he said China will "considerably lower" tariffs on cars and other products this year, take measures to liberalise automobile investment, and protect intellectual property - all areas that have been high on the list of demands by Washington.

The statement comes in the backdrop of U.S. President Trump's stand of punishing China for "stealing American intellectual property rights" as well as correcting the imbalance in bilateral trade of goods between the U.S. and China.

President Rodrigo Duterte left Hainan for Hong Kong on the evening of April 10, after attending the Boao Forum for Asia and holding bilateral talks with Xi. And yet few of his pledges signaled much change.

But it said the potential liberalisation will take effect only in China's 11 free-trade zones. Officials have gradually reduced taxes on auto imports and discussed chopping them further.

But Xi's vows, made in a cavernous room full of global investors and state dignitaries, carry greater weight. Stocks rallied across Asia on Tuesday and European shares rose in morning trading.

The trade imbalance between the two countries is structural, with China exporting more commodities to the United States while importing more services, according to Minister of Commerce Zhong Shan.

China has repeatedly said it will open up sectors such as financial services, including promises to the Trump administration past year that it would give full and prompt market access to USA payment network operators.

"China will not be afraid or back down if a trade war is unavoidable".

Last week, the Trump administration unveiled plans to impose tariffs on 1,300 Chinese products, worth about $50 billion a year in imports to the United States.

In an attempt to reduce the trade imbalance between the two nations, the United States has proposed tariffs on $US150 billion in Chinese imports entering the country, accounting for around 6.6% of China's total exports previous year.

The report on Chinese investment said that how far the U.S. decides to go will have "major consequences" for future investment. Beijing fired back with its own $50 billion list of USA goods for possible retaliation. When a vehicle is sent to China from the United States, there is a tariff to be paid of 25 per cent.

Analysts question whether Xi's conciliatory speech really popped the tension. " 'Give me what the actual tariff rate into China is going to be".

The Eurasia Group agreed the speech was "not a game-changer" and said it "underdelivers after all the hype from Beijing".

Since Xi's Davos debut, China has abolished terms limits so he can stay in power indefinitely. Yet below the surface, there are deep concerns in China on the fallout.

Some still viewed Xi's speech as a welcome de-escalation after last week's antics. "Within 24 hours of the U.S. publishing its list, China drew its sword, and with the same strength and to the same scale, counterattacked quickly, fiercely and with determination", the paper said yesterday.

In the tightly controlled banking sector, for example, overseas companies now can not hold more than 25 percent of a lender's capital, making it hard for them to play a major role in the domestic market.

This is a very important action by China. "Avoiding a trade war will benefit all countries".

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