Steve Inskeep talks to Kevin Rudd, head of the Asia Society Policy Institute and former Australian prime minister, about U.S.-China talks. The U.S. first imposed tariffs in January 2018.
STEVE INSKEEP, HOST:
Two Trump administration negotiators are back in Beijing today. They are working toward a deal that is intended to end a trade war and – U.S. officials hope – change China’s trade practices. We’ve spoken about this with Kevin Rudd. He is a former prime minister of Australia and an expert on China. He is president of the Asia Society Policy Institute. So we asked him how much these trade talks are likely to change.
KEVIN RUDD: On market access in areas of the Chinese economy, which they’ve not opened to America or other investors in the past, there will be a change. We will see how big the change is, but the Chinese – both for their own reasons but also because of U.S. pressure – has decided to open up. There will also be a reduction in Chinese tariffs.
But when you start to get to the three big intractable issues – which is forced technology transfer, proper legal protection for intellectual property, and the mother of them all, which is a Chinese state subsidy for Chinese firms, particularly in the new high-technology industries – I would be very surprised if we see really big, fundamental movement from the Chinese.
INSKEEP: Is the United States well-positioned, then, to gain at least something out of these trade talks, if not everything?
RUDD: To be fair to President Trump, while tariffs, in my view, represent appalling economic policy, they are a reasonable political tactic in seizing the attention of a foreign government – in this case, China. And he succeeded on that. But in terms of the outcome that he produces, it’ll be a classic case of the glass being either half-full or half-empty, depending on who looks at it.
Market access and a reduction in the U.S. trade deficit with China over time – the glass will be more than half full. But on the others, the glass will get progressively empty. And I would be surprised, particularly on that question of state subsidy for China’s high-technology industries, whether we’ll see much substantive Chinese movement at all.
INSKEEP: Do you think that Chinese leaders respect President Trump and his negotiating style?
RUDD: I think the Chinese see in Trump two things. One is a preparedness to double down on these trade negotiations over a long period of time to extract maximum change in the Chinese position. So they see Trump as exercising American strength.
But the second thing they observe, also, is this volatility in the U.S. negotiating position. You don’t have to be a Rhodes Scholar in Beijing to work out that the White House team has been significantly divided on what sort of deal is ultimately acceptable to the United States. So the Chinese sometimes scratch their head about the lack of, as it were, unity and consistency in the U.S. negotiating position.
INSKEEP: Does that give them an ability to take advantage of that United States division?
RUDD: The Chinese watch carefully economic developments in the United States. And they’ve read enough into President Trump’s psychology to know that he, too, fundamentally wants a deal. He wants to put this trade war to bed so that it can be a further shot in the arm for confidence on the part of the American business community as well.
So the Chinese know their own economy is weak, but they know America – and President Trump, in particular – is highly focused on a positive economic outcome as well.
(SOUNDBITE OF EDAMAME’S “KEYS VIEW (LAPA REMIX)”)
INSKEEP: Bit of analysis there from Kevin Rudd, president of the Asia Society Policy Institute and the former prime minister of Australia.
Transcript provided by NPR, Copyright NPR.