PORT MORESBY: Deputy Director-General of the World Trade Organization (WTO) Yi Xiaozhun (second left), Asia Pacific Chairman of PwC Raymund Chao (centre), Co-chairman of the Pacific Economic Co-operation Council Donald Campbell (second right) and Vice Chairman and CEO of the Federation of Korean Industries Tae-Shin Kwon (right) attend the APEC CEO Summit in Port Moresby, a part of the Asia-Pacific Economic Cooperation (APEC) Summit. -AFP

PORT MORESBY: The United States will not back down from its trade dispute with China, and might even double its tariffs, unless Beijing bows to US demands, Vice President Mike Pence said yesterday. In a bluntly worded speech at an Asia Pacific Economic Co-operation (APEC) summit in Papua New Guinea, Pence threw down the gauntlet to China on trade and security in the region. "We have taken decisive action to address our imbalance with China," Pence declared. "We put tariffs on $250 billion in Chinese goods, and we could more than double that number."

"The United States, though, will not change course until China changes its ways." The stark warning will likely be unwelcome news to financial markets which had hoped for a thaw in the Sino-US dispute and perhaps even some sort of deal at a G20 meeting later this month in Argentina. US President Donald Trump, who is not attending the APEC meeting, is due to meet Chinese President Xi Jinping in Argentina.

Pence's warning yesterday contrasted with remarks made by Trump on Friday, when he said he may not impose more tariffs after China sent the United States a list of measures it was willing to take to resolve trade tensions. Trump has imposed tariffs on $250 billion worth of Chinese imports to force concessions on a list of demands that would change the terms of trade between the two countries. China has responded with import tariffs on US goods.

Washington is demanding Beijing improve market access and intellectual property protections for US companies, cut industrial subsidies and slash a $375 billion trade gap. There was no hint of compromise from Pence. "China has taken advantage of the United States for many years. Those days are over," he told delegates gathered on a cruise liner docked in Port Moresby's Fairfax Harbor.

He also took aim at China's territorial ambitions in the Pacific and, particularly, Xi's Belt and Road Initiative to expand land and sea links between Asia, Africa and Europe with billions of dollars in infrastructure investment.

"We don't offer constricting belts or a one-way road," said Pence.

While not referring directly to Chinese claims over various disputed waters in the region, Pence said the United States would work to help protect maritime rights. "We will continue to fly and sail where ever international law allows and our interests demand. Harassment will only strengthen our resolve." Just minutes earlier, Xi had spoken at length about his initiative and the need for free trade across the region.

"It is not an exclusive club closed to non-members, nor is it a trap as some people have labelled it," Xi said of his brainchild project. He also called protectionism a "shortsighted approach" that was "doomed to fail". "History has shown that confrontation, whether in the form of a Cold War, hot war, or trade war will produce no winners," said Xi.

Short-sighted

Protectionist actions are short-sighted and doomed to fail, Chinese President Xi Jinping said yesterday ahead of an APEC summit at which US-China trade tensions are likely to take center-stage. "Attempts to erect barriers and cut close economic ties work against the laws of economics and the trends of history. This is a short-sighted approach and it is doomed to failure," Xi told business leaders on the sidelines of the summit. "We should say no to protectionism and unilateralism," urged Xi, in a veiled swipe at the "America First" policies of the US administration.

APEC members the US and China have become embroiled in a trade war that experts warn could be catastrophic for the global economy, with the world's top two powers going head to head. The pair have imposed tariffs worth billions of dollars of each other's goods and there is little sign of an immediate easing in tensions, with both sides threatening to step up action if necessary. Xi said the world should "uphold the WTO-centered multilateral trading system, make economic globalization more open, inclusive, balanced and beneficial to all".

With concerns growing that rivalry between the US and China could escalate, Xi warned against going down this road. "History has shown that confrontation-whether in the form of a cold war, hot war or trade war-will produce no winners," Xi said. "We believe that there exist no issues that countries cannot resolve through consultation," said the Chinese leader, as long as negotiations take place in a spirit of "equality" and "mutual understanding." - Agencies