White House trade adviser Peter Navarro gave a rare public rebuke of Treasury Secretary Steven Mnuchin for declaring the USA trade war with China was on hold, calling it an "unfortunate sound bite" and acknowledging there's a dispute that needs to be resolved.
In an unexpected change in tone, the United States said on Tuesday that it still held the threat of imposing tariffs on $50 billion of imports from China unless it addressed the issue of theft of American intellectual property.
China's Commerce Ministry reacted swiftly overnight with a short statement, saying it was surprised and saw it as contrary to the consensus both sides had reached recently.
She urged the U.S. to keep its "word and work" with China according to the spirit demonstrated in the joint announcement.
China lashed out on Wednesday at renewed threats from the White House on trade, warning that it was ready to fight back if Washington was looking for a trade war, days ahead of a planned visit by U.S. Commerce Secretary Wilbur Ross. "China will surely take resolute and powerful steps to safeguard its legitimate rights if the USA insists on acting recklessly".
Hua also called for handling trade disputes through talks on an equal basis and in a constructive way, which is "in line with the fundamental and long-term interests of both the Chinese and American people, as well as the common aspirations of the global community".
Ross is due to hold talks in Beijing from June 2-4 to work out the details for China to buy more American agriculture and energy exports and narrow the U.S.'s $375 billion trade gap with China.
"What we're having with China is a trade dispute, fair and simple", he said.
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The final list of Chinese imports covered by the tariffs list will be announced June 15 and imposed shortly thereafter, while the proposed investment restrictions and enhanced export controls will be announced by June 30, according to the White House.
The commerce ministry said earlier Wednesday that Beijing "has the confidence, capability and experience to defend the interests of Chinese people and the core interests of the country" - no matter what measures the USA plans to take. His comments, following meetings with Chinese President Xi Jinping's top economic adviser, fueled expectations that both sides would be able to settle their differences through negotiations.
"China will continue to hold pragmatic consultations with the United States' delegation and hope that the United States will act in accordance with the spirit of the joint statement". "We lost the trade war long ago".
Trump has also threatened to impose tariffs on an additional $100 billion in Chinese goods if Beijing retaliates.
In retaliation, China announced plans to impose new tariffs of 25 per cent worth United States dollars 50 billion on 106 American products including items like soybeans which could hurt American farmers. The two countries have not yet implemented their tariff increases.
"When it comes to worldwide relations, every time a country does an about face and contradicts itself, it's another blow to, and a squandering of, its reputation", Hua said. Over 1.65 lakh Indian students enrolled in United States universities in 2016.