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China, Germany relate their common interests

Germany and China are both facing the implementation of Trump’s ‘America First’ foreign trade policy

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German Chancellor Angela Merkel’s visit to Beijing this week gives us some important details about what is moving the cogs of her foreign diplomatic and trade relations agenda. Merkel has several reasons, both politically and economically to make this journey.

First of all, China and Germany are both signatories to the Joint Comprehensive Plan of Action on Iran’s nuclear enrichment program, and both parties wish to see it preserved against Donald Trump’s American withdrawal and reimposition of crippling economic sanctions against the Middle Eastern country of 80 million.

Second of all, Germany and China are both facing the implementation of Trump’s ‘America First’ foreign trade policy through tariffs and possible sanctions effects over the actions that may be undertaken relative to Russia and Iran.

Next, both Beijing and Berlin have a sturdy interest in maintaining or even increasing their trade relationships with Iran as well as Russia, both of which are nations that are presently the targets of American sanctions (although Germany had a role to play in the sanctions imposed on Russia).

Reuters reports:

BEIJING (Reuters) – China said on Thursday it would “open its door wider” to German businesses, giving a warm reception to visiting Chancellor Angela Merkel, who has wooed Beijing to counterbalance trade threats from U.S. President Donald Trump.

Germany and China, two exporting nations that run large trade surpluses with the United States, have found themselves in Trump’s firing line and are scrambling to preserve the multi-lateral order on which their prosperity rests.

Merkel faces a delicate balancing act on the trip to show Chinese-German solidarity over trade and the Iran nuclear deal without harming ties with long-term ally Washington.

In the latest U.S. trade move that has alarmed Beijing and Berlin alike, the Trump administration announced on Wednesday a national security investigation on into car and truck imports that could potentially lead to tariffs.

The announcement hurt share prices of both European and Asian carmakers. China vowed to protect its interests.

European countries are also concerned that their exporters could be hurt if China instructs importers to buy more U.S. goods to ease trade disputes with the Trump administration. China has already signalled to state companies to buy more U.S. oil and soybeans, trade sources told Reuters.

Premier Li Keqiang, in a joint media appearance with Merkel at Beijing’s Great Hall of the People, said China and Germany both upheld global free trade, and stressed the huge potential for cooperation between them.

Though the two countries had problems, they could be overcome, Li said. “China’s door is open. You can say it will open even wider,” Li said.

Trump’s “America First” trade policy, his administration’s professed disdain for the World Trade Organisation, as well as his withdrawal from the Iran nuclear deal, have pushed China and Germany into closer alignment, German officials say.

However, Merkel’s government also shares many of the Trump administration’s concerns about Chinese business practices, including what many Western countries say are state-backed efforts to push foreign companies to give up trade secrets.

In Copenhagen, the chief executive of Maersk, the world’s biggest container shipper, said China was “becoming more and more assertive about its own agenda – a China that uses its competition laws for own benefit” in the shipping sector.

“We look with concern at the growing protectionist rhetoric around the world,” Soren Skou said. “The EU will be the decisive driving force in free trade, not the least at a time when it seems the United States doesn’t want to take the lead.”

“STRIDING FORWARD”

Li said Beijing would protect the interests of German firms investing in China and adjust its rules if needed: “If they come across any problems during their investment, especially when it comes to legal protections, I can clearly tell you that China is striding forward to being a country with rule of law.”

German companies have complained for years about barriers to the Chinese market and intellectual property theft.

Merkel welcomed China’s recent announcements that it would further open its financial sector to foreign participation and reduce Chinese joint venture requirements in sectors such as automobiles. But German industry said it was now up to China to deliver on its promises of greater openness.

“China must rigorously reduce the asymmetries in market access,” said Hubert Lienhard, head of the Asia Pacific Committee of German Industry (APA).

Trump has also driven Europe to work more closely with China by pulling out of a 2015 deal to lift sanctions against Iran in return for curbs on its nuclear programme. European countries, Russia and China, all parties to the deal, are searching for a way to salvage it by continuing to offer economic benefits to Iran in return for its compliance, despite U.S. sanctions.

Merkel, who personally lobbied Trump not to pull out of the pact but was rebuffed, said Germany and China were “united in the view that we do not want to put this agreement in doubt”.

In a nod to China, Merkel said that if U.S. sanctions force European companies to reduce business with Iran, “this creates the possibility for others to then get more into Iran.”

China has been able to convince Trump to reel in his tariffs campaign against the Chinese if they can reduce or eliminate their trade deficit with the USA. However, Berlin is at the tail end of its exemption from metals tariffs of 10% on aluminum and 25% on steel, respectively, with the exemption to come to a close on the first of June.

Therefore, if Europe does not see an extension of these exemptions, and realizes even more tariffs, that could include a tariff on European manufactured autos, then the Europeans will, like Japan, feel the sting of Trump’s ‘America First’ brand of protectionism. .

Meanwhile, Merkel’s statement about ‘others getting more into Iran’ looks somewhat like Merkel is feeling the fear of loss, as Iran is, due to US sanctions, virtually an untapped market when it comes to potential investment opportunities.

Between combatting America’s tariffs regime and sanctions polity, both China and Germany are realizing a lot more common interests than in more recent years, and are therefore finding more reasons why it benefits them mutually to cooperate where they coincide. Overall, the discussions are very similar in their message as the theme that was presented at the St. Petersburg International Economic Forum (SPIEF) this past week, which did enjoy China’s participation, being represented by Vice President Wang Qishan.

 

 

 

 

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Skripal and Khashoggi: A Tale of Two Disappearances

Two disappearances, and two different responses.

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Authored by Finian Cunningham via The Strategic Culture Foundation:


Two disappearances, and two very different responses from Western governments, which illustrates their rank hypocrisy.

When former Russian spy Sergei Skripal went missing in England earlier this year, there was almost immediate punitive action by the British government and its NATO allies against Moscow. By contrast, Western governments are straining with restraint towards Saudi Arabia over the more shocking and provable case of murdered journalist Jamal Khashoggi.

The outcry by Western governments and media over the Skripal affair was deafening and resulted in Britain, the US and some 28 other countries expelling dozens of Russian diplomats on the back of unsubstantiated British allegations that the Kremlin tried to assassinate an exiled spy with a deadly nerve agent. The Trump administration has further tightened sanctions citing the Skripal incident.

London’s case against Moscow has been marked by wild speculation and ropey innuendo. No verifiable evidence of what actually happened to Sergei Skripal (67) and his daughter Yulia has been presented by the British authorities. Their claim that President Vladimir Putin sanctioned a hit squad armed with nerve poison relies on sheer conjecture.

All we know for sure is that the Skripals have been disappeared from public contact by the British authorities for more than seven months, since the mysterious incident of alleged poisoning in Salisbury on March 4.

Russian authorities and family relatives have been steadfastly refused any contact by London with the Skripal pair, despite more than 60 official requests from Moscow in accordance with international law and in spite of the fact that Yulia is a citizen of the Russian Federation with consular rights.

It is an outrage that based on such thin ice of “evidence”, the British have built an edifice of censure against Moscow, rallying an international campaign of further sanctions and diplomatic expulsions.

Now contrast that strenuous reaction, indeed hyper over-reaction, with how Britain, the US, France, Canada and other Western governments are ever-so slowly responding to Saudi Arabia over the Khashoggi case.

After nearly two weeks since Jamal Khashoggi entered the Saudi consulate in Istanbul, Turkey, the Saudi regime is this week finally admitting he was killed on their premises – albeit, they claim, in a “botched interrogation”.

Turkish and American intelligence had earlier claimed that Khashoggi was tortured and murdered on the Saudi premises by a 15-member hit squad sent from Riyadh.

Even more grisly, it is claimed that Khashoggi’s body was hacked up with a bone saw by the killers, his remains secreted out of the consulate building in boxes, and flown back to Saudi Arabia on board two private jets connected to the Saudi royal family.

What’s more, the Turks and Americans claim that the whole barbaric plot to murder Khashoggi was on the orders of senior Saudi rulers, implicating Crown Prince Mohammed bin Salman. The latest twist out of Riyadh, is an attempt to scapegoat “rogue killers” and whitewash the House of Saudi from culpability.

The fact that 59-year-old Khashoggi was a legal US resident and a columnist for the Washington Post has no doubt given his case such prominent coverage in Western news media. Thousands of other victims of Saudi vengeance are routinely ignored in the West.

Nevertheless, despite the horrific and damning case against the Saudi monarchy, the response from the Trump administration, Britain and others has been abject.

President Trump has blustered that there “will be severe consequences” for the Saudi regime if it is proven culpable in the murder of Khashoggi. Trump quickly qualified, however, saying that billion-dollar arms deals with the oil-rich kingdom will not be cancelled. Now Trump appears to be joining in a cover-up by spinning the story that the Khashoggi killing was done by “rogue killers”.

Britain, France and Germany this week issued a joint statement calling for “a credible investigation” into the disappearance. But other than “tough-sounding” rhetoric, none of the European states have indicated any specific sanctions, such as weapons contracts being revoked or diplomatic expulsions.

Canadian Prime Minister Justin Trudeau said he was “concerned” by the gruesome claims about Khashoggi’s killing, but he reiterated that Ottawa would not be scrapping a $15 billion sale of combat vehicles to Riyadh.

The Saudi rulers have even threatened retaliatory measures if sanctions are imposed by Western governments.

Saudi denials of official culpability seem to be a brazen flouting of all reason and circumstantial evidence that Khashoggi was indeed murdered in the consulate building on senior Saudi orders.

This week a glitzy international investor conference in Saudi Arabia is being boycotted by top business figures, including the World Bank chief, Jim Yong Kim, JP Morgan CEO Jamie Dimon and Britain’s venture capitalist Richard Branson. Global firms like Ford and Uber have pulled out, as have various media sponsors, such as CNN, the New York Times and Financial Times. Withdrawal from the event was in response to the Khashoggi affair.

A growing bipartisan chorus of US Senators, including Bob Corker, Marco Rubio, Lindsey Graham and Chris Murphy, have called for the cancellation of American arms sales to Saudi Arabia, as well as for an overhaul of the strategic partnership between the two countries.

Still, Trump has rebuffed calls for punitive response. He has said that American jobs and profits depend on the Saudi weapons market. Some 20 per cent of all US arms sales are estimated to go to the House of Saud.

The New York Times this week headlined: “In Trump’s Saudi Bargain, the Bottom Line Proudly Stands Out”.

The Trump White House will be represented at the investment conference in Saudi Arabia this week – dubbed “Davos in the Desert” by Treasury Secretary Steven Mnuchin. He said he was attending in spite of the grave allegations against the Saudi rulers.

Surely the point here is the unseemly indulgence by Western governments of Saudi Arabia and its so-called “reforming” Crown Prince. It is remarkable how much credulity Washington, London, Paris, Ottawa and others are affording the Saudi despots who, most likely, have been caught redhanded in a barbarous murder.

Yet, when it comes to Russia and outlandish, unproven claims that the Kremlin carried out a bizarre poison-assassination plot, all these same Western governments abandon all reason and decorum to pile sanctions on Russia based on lurid, hollow speculation. The blatant hypocrisy demolishes any pretense of integrity or principle.

Here is another connection between the Skripal and Khashoggi affairs. The Saudis no doubt took note of the way Britain’s rulers have shown absolute disregard and contempt for international law in their de facto abduction of Sergei and Yulia Skripal. If the British can get away with that gross violation, then the Saudis probably thought that nobody would care too much if they disappeared Jamal Khashoggi.

Grotesquely, the way things are shaping up in terms of hypocritical lack of action by the Americans, British and others towards the Saudi despots, the latter might just get away with murder. Not so Russia. The Russians are not allowed to get away with even an absurd fantasy.

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US-China trade war heats up as surplus hits record $34 Billion (Video)

The Duran – News in Review – Episode 136.

Alex Christoforou

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According to a report by the AFP, China’s trade surplus with the United States ballooned to a record $34.1 billion in September, despite a raft of US tariffs, official data showed Friday, adding fuel to the fire of a worsening trade war.

Relations between the world’s two largest economies have soured sharply this year, with US President Donald Trump vowing on Thursday to inflict economic pain on China if it does not blink.
The two countries imposed new tariffs on a massive amount of each other’s goods mid-September, with the US targeting $200 billion in Chinese imports and Beijing firing back at $60 billion worth of US goods.

“China-US trade friction has caused trouble and pounded our foreign trade development,” customs spokesman Li Kuiwen told reporters Friday.

But China’s trade surplus with the US grew 10 percent in September from a record $31 billion in August, according to China’s customs administration. It was a 22 percent jump from the same month last year.

China’s exports to the US rose to $46.7 billion while imports slumped to $12.6 billion.

China’s overall trade — what it buys and sells with all countries including the US — logged a $31.7 billion surplus, as exports rose faster than imports.

Exports jumped 14.5 percent for September on-year, beating forecasts from analysts polled by Bloomberg News, while imports rose 14.3 percent on-year.

While the data showed China’s trade remained strong for the month, analysts forecast the trade war will start to hurt in coming months.

China’s export jump for the month suggests exporters were shipping goods early to beat the latest tariffs, said ANZ’s China economist Betty Wang, citing the bounce in electrical machinery exports, much of which faced the looming duties.

“We will watch for downside risks to China’s exports” in the fourth quarter, Wang said.

Analysts say a sharp depreciation of the yuan has also helped China weather the tariffs by making its exports cheaper.

“The big picture is the Chinese exports have so far held up well in the face of escalating trade tensions and cooling global growth, most likely thanks to the competitiveness boost provided by a weaker renminbi (yuan),” said Julian Evans-Pritchard, China economist at Capital Economics.

“With global growth likely to cool further in the coming quarters and US tariffs set to become more punishing, the recent resilience of exports is unlikely to be sustained,” he said.

According to Bloomberg US President Donald Trump’s new U.S.-Mexico-Canada Agreement isn’t that different from the North American Free Trade Agreement that it replaced. But hidden in the bowels of the new trade deal is a clause, Article 32.10, that could have a far-reaching impact. The new agreement requires member states to get approval from the other members if they initiate trade negotiations with a so-called non-market economy. In practice, “non-market” almost certainly means China. If, for example, Canada begins trade talks with China, it has to show the full text of the proposed agreement to the U.S. and Mexico — and if either the U.S. or Mexico doesn’t like what it sees, it can unilaterally kick Canada out of the USMCA.

Although it seems unlikely that the clause would be invoked, it will almost certainly exert a chilling effect on Canada and Mexico’s trade relations with China. Forced to choose between a gargantuan economy across the Pacific and another one next door, both of the U.S.’s neighbors are almost certain to pick the latter.

This is just another part of Trump’s general trade waragainst China. It’s a good sign that Trump realizes that unilateral U.S. efforts alone won’t be enough to force China to make concessions on issues like currency valuation, intellectual-property protection and industrial subsidies. China’s export markets are much too diverse:

If Trump cuts the U.S. off from trade with China, the likeliest outcome is that China simply steps up its exports to other markets. That would bind the rest of the world more closely to China and weaken the global influence of the U.S. China’s economy would take a small but temporary hit, while the U.S. would see its position as the economic center of the world slip into memory.

Instead, to take on China, Trump needs a gang. And that gang has to be much bigger than just North America. But most countries in Europe and East Asia probably can’t be bullied into choosing between the U.S. and China. — their ties to the U.S. are not as strong as those of Mexico and Canada. Countries such as South Korea, Germany, India and Japan will need carrots as well as sticks if they’re going to join a U.S.-led united trade front against China.

The Duran’s Alex Christoforou and Editor-in-Chief Alexander Mercouris discuss the escalating trade war between the United States and China, and the record trade surplus that positions China with a bit more leverage than Trump anticipated.

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Via Zerohedge Trump Threatens China With More Tariffs, Does Not Seek Economic “Depression”

US equity futures dipped in the red after President Trump threatened to impose a third round of tariffs on China and warned that Chinese meddling in U.S. politics was a “bigger problem” than Russian involvement in the 2016 election.

During the same interview with CBS’s “60 Minutes”, in which Trump threatened to impose sanctions against Saudi Arabia if the Saudis are found to have killed WaPo reported Khashoggi, and which sent Saudi stock plunging, Trump said he “might,” impose a new round of tariffs on China, adding that while he has “great chemistry” with Chinese President Xi Jinping, and noting that Xi “wants to negotiate”, he doesn’t “know that that’s necessarily going to continue.” Asked if American products have become more expensive due to tariffs on China, Trump said that “so far, that hasn’t turned out to be the case.”

“They can retaliate, but they can’t, they don’t have enough ammunition to retaliate,” Trump says, “We do $100 billion with them. They do $531 billion with us.”

Trump was also asked if he wants to push China’s economy into a depression to which the US president said “no” before comparing the country’s stock-market losses since the tariffs first launched to those in 1929, the start of the Great Depression in the U.S.

“I want them to negotiate a fair deal with us. I want them to open their markets like our markets are open,” Trump said in the interview that aired Sunday. So far, the U.S. has imposed three rounds of tariffs on Chinese imports totaling $250 billion, prompting China to retaliate against U.S. products. The president previously has threatened to hit virtually all Chinese imports with duties.

Asked about his relationship with Vladimir Putin and the Kremlin’s alleged efforts to influence the 2016 presidential election, Trump quickly turned back to China. “They meddled,” he said of Russia, “but I think China meddled too.”

“I think China meddled also. And I think, frankly, China … is a bigger problem,” Trump said, as interviewer Lesley Stahl interrupted him for “diverting” from a discussion of Russia.

Shortly before an audacious speech by Mike Pence last weekend, in which the US vice president effectively declared a new cold war on Beijing (see “Russell Napier: Mike Pence Announces Cold War II”), Trump made similar accusations during a speech at the United Nations last month, which his aides substantiated by pointing to long-term Chinese influence campaigns and an advertising section in the Des Moines Register warning farmers about the potential effects of Trump’s tariffs.

Meanwhile, in a rare U.S. television appearance, China’s ambassador to the U.S. said Beijing has no choice but to respond to what he described as a trade war started by the U.S.

“We never wanted a trade war, but if somebody started a trade war against us, we have to respond and defend our own interests,” said China’s Ambassador Cui Tiankai.

Cui also dismissed as “groundless” the abovementioned suggestion by Vice President Mike Pence that China has orchestrated an effort to meddle in U.S. domestic affairs. Pence escalated the rhetoric in a speech Oct. 4, saying Beijing has created a “a whole-of-government approach” to sway American public opinion, including spies, tariffs, coercive measures and a propaganda campaign.

Pence’s comments were some of the most critical about China by a high-ranking U.S. official in recent memory. Secretary of State Michael Pompeo got a lecture when he visited Beijing days later, about U.S. actions that were termed “completely out of line.” The tough words followed months of increases tit-for-tat tariffs imposed by Washington and Beijing that have ballooned to cover hundreds of billions of dollars in bilateral trade.

During a recent interview with National Public Radio, Cui said the U.S. has “not sufficiently” dealt in good faith with the Chinese on trade matters, saying “the U.S. position keeps changing all the time so we don’t know exactly what the U.S. would want as priorities.”

Meanwhile, White House economic director Larry Kudlow said on “Fox News Sunday” that President Donald Trump and Chinese President Xi Jinping will “probably meet” at the G-20 summit in Buenos Aires in late November. “There’s plans and discussions and agendas” being discussed, he said. So far, talks with China on trade have been “unsatisfactory,” Kudlow said. “We’ve made our asks” on allegations of intellectual property theft and forced technology transfers, he added. “We have to have reciprocity.”

Addressing the upcoming meeting, Cui said he was present at two previous meetings of Xi and Trump, and that top-level communication “played a key role, an irreplaceable role, in guiding the relationship forward.” Despite current tensions the two have a “good working relationship,” he said.

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Massacre in Crimea kills dozens, many in critical condition

According to preliminary information, the incident was caused by a gas explosion at a college facility in Kerch, Crimea.

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“We are clarifying the information at the moment. Preliminary figures are 50 injured and 10 dead. Eight ambulance crews are working at the site and air medical services are involved,” the press-service for the Crimean Ministry of Health stated.

Medics announced that at least 50 people were injured in the explosion in Kerch and 25 have already been taken to local hospital with moderate wounds, according to Sputnik.

Local news outlets reported that earlier in the day, students at the college heard a blast and windows of the building were shattered.

Putin Orders that Assistance Be Provided to Victims of Blast in Kerch – Kremlin Spokesman

“The president has instructed the Ministry of Health and the rescue services to take emergency measures to assist victims of this explosion, if necessary, to ensure the urgent transportation of seriously wounded patients to leading medical institutions of Russia, whether in Moscow or other cities,” Kremlin spokesman Dmitriy Peskov said.

The president also expressed his condolences to all those affected by the tragic incident.

Manhunt Underway in Kerch as FSB Specialists Investigate Site of Explosion – National Anti-Terrorist Committee

The site of the blast that rocked a city college in Kerch is being examined by FSB bomb disposal experts and law enforcement agencies are searching for clues that might lead to the arrest of the perpetrators, the National Anti Terrorism Committee said in a statement.

“Acting on orders from the head of the NAC’s local headquarters, FSB, Interior Ministry, Russian Guards and Emergency Ministry units have arrived at the site. The territory around the college has been cordoned off and the people inside the building evacuated… Mine-disposal experts are working at the site and law enforcement specialists are investigating,” the statement said.

Terrorist Act Considered as Possible Cause of Blast in Kerch – Kremlin Spokesman

“The tragic news that comes from Kerch. Explosion. The president was informed … The data on those killed and the number of injured is constantly updated,” Peskov told reporters.

“[The version of a terrorist attack] is being considered,” he said.

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