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Chinese media on Friday hit back at a U.S. academic report which urged the United States to engage in "tit-for-tat" retaliation to counter what it said was China's widening campaign for influence which threatened to undermine democratic values.
The 213-page report, published by the U.S. think tank Hoover Institution on Thursday, said China's ruling Communist Party had in recent years "significantly accelerated" both the investment and intensity of its global influence-seeking efforts.
The report was penned by a group of more than 30 prominent Western experts, such as Orville Schell, director of the Center on U.S.-China Relations at the Asia Society in New York, many whom had long advocated for closer engagement with China.
The sharper tone comes as President Xi Jinping has increased repression at home and adopted what the report describes as an "increasingly forward and aggressive posture on the global stage".
U.S. President Donald Trump said on Thursday said there was "a long way to go" on tariffs with China and urged companies to build products in the United States to avoid them.Trump, who planned to meet with Chinese President Xi Jinping on Saturday on the sidelines of the G20 summit in Argentina, said in a Twitter post that tariffs on China were bringing money into the United States and "there is a long way to go." Details emerge of Erdoğan, Trump meeting at G20 summitChina hopes for positive results from US talks at G20Putin, Trump due to meet at G20 on Dec. 1
Trump says 'long way to go' on tariffs and China
China's state-run Global Times said the report's threat assessment was unfounded.
"We believe the Chinese infiltration into the United States the report describes does not match up with China's objective aspirations," the newspaper said in an editorial.
The report, however, found that there was now a "surprising" level of bi-partisan scepticism about China's intentions and a willingness to push back against its "predatory" policies.
"China is exploiting America's openness in order to advance its aims on a competitive playing field," it said. "Once largely a form of economic competition, China's recent turn to military and political rivalry with the United States has changed the whole equation of the bilateral relationship."
U.S. agriculture suppliers are stockpiling the Chinese chemicals that farmers need to kill crop pests and boost yields - before tariffs on them more than double on Jan. 1.The additional tariffs, threatened by U.S. President Donald Trump, are part of an eight-month trade war between the United States and China affecting $250 billion worth of Chinese products and $113 billion in U.S. goods.The duties could disrupt supply lines for U.S. companies that sell chemicals and fertilizers, part of a $28-billion U.S. farm chemical industry. The sector relies on Chinese imports for 40 percent of the ingredients and materials needed to make crop chemicals, according to consultancy Informa.Nutrien Ltd - the biggest U.S. retailer of farm supplies - is stockpiling enough chemicals to last into the busy 2019 planting season, the company said in a statement. Nutrien is carrying $300 million more in chemical inventory than it had a year earlier.Other distributors are doing the same, said Daren Coppock, CEO of the Agricultural Retailers Association. Those who have the means to stock up will do so, he said.Higher tariffs on farm chemicals would deal another blow to an agricultural industry that has already seen prices for staple crops plummet because of the trade war between the world’s two largest economies. China has imposed import taxes on U.S. crops including soybeans - effectively shutting off an export worth $12 billion in 2017.The Trump Administration imposed 10 percent tariffs starting Sept. 24 on about 5,700 Chinese exports, ranging from pork to bicycle tires. The duties are scheduled to rise to 25 percent on Jan. 1, and the potential economic damage adds urgency to a meeting expected between Trump and Chinese President Xi Jinping at the G20 summit in Argentina that starts Friday.Trump has lately sounded more hopeful of resolving divisions with China, saying on Nov. 16 that higher tariffs may not be needed.Small U.S. chemical-makers like Willowood USA and Albaugh, however, say they have already raised prices to account for a continued standoff.The prospect of higher pesticide costs on top of weak crop prices is "worrisome," said Joe Ericson, president of the North Dakota Soybean Growers Association. The state's farmers depend on China to buy soybeans, but the oilseeds have piled up in elevators - storage facilities that buy from farmers - as the world's biggest buyer has instead turned to countries such as Brazil."We're hit probably more than anybody with the Chinese tariffs," Ericson said. "That's a big blow to our economy when the elevators can't get rid of them."Retailers have seen farmers cutting back on chemical and fertilizer purchases in the wake of tariffs, Coppock said.Farmers' costs for such supplies are a big part of that equation: U.S. soy farmers spent $52 per acre applying chemicals and fertilizer in 2017, or 12 percent of their total costs, according to the U.S. Department of Agriculture.Winners and losersMost chemicals formulated in China - including those containing the widely used weed-killers glyphosate, dicamba and 2,4-D - have incurred new tariffs since September, along with some chemical ingredients, said Sanjiv Rana, editor-in-chief of the crop protection news service Agrow, part of Informa.The same products hit by tariffs in September will see even higher duties in January, said a spokesperson for the U.S. Trade Representative's office. The spokesperson said the tariffs are designed to discourage China's "market-distorting actions" and defend the United States from unfair trade practices.The tariffs are having an uneven impact on chemical companies. Bayer AG, which makes glyphosate and dicamba pesticides in the United States, is largely unaffected, spokeswoman Christi Dixon said.Tariffs do apply to glyphosate formulations made by Chinese companies, however. They directly benefit Bayer if the prices of the Chinese products exported to the United States rise because the firm sells glyphosate branded as Roundup at a premium over generic brands from China, said Jonas Oxgaard, analyst at Bernstein.A 25 percent tariff may result in U.S. glyphosate prices rising by 15 or 20 percent, he said.The tariffs would affect Syngenta, which imports Chinese products for its crop protection formulations, said spokesman Paul Minehart. The company is seeking alternate sources, he said.BASF SE is concerned about the tariffs but still analyzing their potential impact, spokeswoman Odessa Hines said.Nutrien, the retailer that sells to farmers, has already stockpiled chemicals including dicyandiamide (DCD), a fertilizer ingredient made almost exclusively in China."If the tariffs do come in, you're going to have higher costs for most of the major agri-chemicals," Chief Executive Chuck Magro said in an interview. "This will be something that ultimately affects the farmer."Passing on costsSince the Trump administration applied 10 percent tariffs in September, The Chemical Company, based in Rhode Island, has raised its DCD chemical price about 8 percent, said general sales manager AJ Petrarca.With 25 percent tariffs coming, the company ordered more from Chinese manufacturers including Ningxia Jiafeng Chemicals Co and Beilite, swelling inventories by about 10 percent over normal levels, he said.Those stockpiles may only last until February or March, however."I don't think we'll have enough to keep everybody whole throughout the season," Petrarca said.U.S. customers, not Beilite, will absorb the tariff cost, said the Chinese company's export manager, who gave his surname as Wang."It is not good to do business in the U.S. market now," he said.U.S. chemical-maker Willowood has little choice but to pass higher costs of buying Chinese chemicals on to retailers who sell to farmers."There's not enough margin to eat that difference," said Joe Middione, Willowood's strategic business manager. "We're seeing fairly significant increases across the portfolio."December is typically a brisk sales period, when farmers stock up before a new tax year."It's caused a lot of confusion," Middione said. Farmers, he said, are "shell-shocked."
US farm sector stockpiles Chinese chemicals before scheduled tariffs
In order to counter China's activities, the report makes a series of suggestions for United States lawmakers, institutions and businesses that it said could help ensure "transparency, integrity and reciprocity".
It recommends denying U.S. visas to Chinese journalists and having scholars affiliated with the Chinese government-run "Thousand Talents Programme" registered as a foreign agent.
The report also lauded recent legislation that strengthened the review process by the Committee on Foreign Investment in the United States (CFIUS), an interagency panel that assesses the national security implications of investment.
Legislation passed in June by U.S. President Donald Trump was a "substantial improvement" that closed loopholes that China had been exploiting, it said.
China is hoping for "positive results" at a G20 summit in Argentina, the commerce ministry said on Thursday, ahead of a closely watched meeting between Chinese and U.S. leaders.U.S. President Donald Trump and Chinese President Xi Jinping are due to hold trade talks on the sidelines of the G20 summit in Buenos Aires this weekend.The United States has levied additional duties of between 10 percent and 25 percent on $250 billion of Chinese goods this year as punishment for what it calls the country's unfair trade practices, with the 10 percent tariffs set to rise to 25 percent next year.Putin, Trump due to meet at G20 on Dec. 1Turkey to address challenges of global economy at G20
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The authors also included a note of caution that China's efforts should not be exaggerated.
"China has not sought to interfere in a national election in the United States or to sow confusion or inflame polarisation in our democratic discourse the way Russia has done," it said.
Chinese Foreign Ministry spokesman Geng Shuang said it was their custom not to give detailed comment on think tank reports, but he said China welcomed U.S. companies, media, students and think tanks to come to the country.
"We hope that the United States, as the world's most powerful country, can open both arms and welcome companies, the media, think tanks and students from all countries, including China, to go to the United States," he told reporters.