UPDATE1: China makes conciliatory gesture to U.S. amid trade war

Japan Economic Newswire |

Chinese Premier Li Keqiang on Friday made a conciliatory gesture to the United States with the world's second-largest economy slowing down against the backdrop of a trade dispute with Washington, saying the two countries should cooperate to create "mutual interests."

With speculation that Chinese President Xi Jinping and U.S. President Donald Trump may hold a summit in the near future to end a trade war, Li expressed his readiness to make the nation's market more open and transparent to foreigners.

Li, meanwhile, rejected the alleged involvement of Chinese companies in spying activities, making clear once again Beijing's stance against Washington's ban on the use of products and services of Chinese telecommunication giants such as Huawei Technologies Co. and ZTE Corp.

Stable relations between China and the United States would bring "benefits" to both sides and the world, Li said at a press conference following the end of a parliamentary session.

Li added he hopes that Sino-U.S. negotiations would "achieve results that would yield mutual interests," hours after Chinese media reported senior trade officials of the two countries made "further substantial progress" during their telephone talks on Thursday.

China wrapped up the 11-day annual session of the National People's Congress on Friday morning after approving several laws including one aimed at prohibiting forced technology transfer from foreign firms to their Chinese partners.

At their previous summit in Argentina in December, Xi and Trump agreed to a truce in which both promised to refrain from imposing further tariffs for 90 days while trying to complete trade negotiations.

As working-level and ministerial-level talks continue, Washington said late last month that it has extended the deadline, but the world's two biggest economies have remained at odds over what Washington calls Beijing's "unfair" trade practices.

The enactment of a new foreign investment law at China's largely rubber-stamp legislature suggested that Beijing has made some concessions to Washington over contentious trade issues such as alleged intellectual property theft and forced technology transfer.

As for growing fears about spying activities by Chinese companies, Li dismissed them, saying that is "not the Chinese way."

Washington has voiced concern that Huawei products may facilitate spying and disrupt communication networks, while urging its allies to exclude the telecommunications firm from government contracts.

Since August last year, Trump's administration has banned the use of products and services of ZTE and Huawei, which was founded in 1987 by Ren Zhengfei, a former engineer in the Chinese military.

Earlier this month, Huawei, a leader in the field of next-generation 5G mobile communications, said it has filed a lawsuit against the U.S. government with a federal district court in Texas.

As a tit-for-tat tariff escalation with the United States -- worth hundreds of billions of dollars -- has choked exports as well as private spending and investment at home, Li pledged to implement "strong measures" to prop up the nation's economy.

"The Chinese economy has indeed encountered new downward pressure," Li said, adding Beijing will take steps to invigorate its market that contains over 100 million households.

Li, however, ruled out the possibility of introducing drastic measures like quantitative monetary easing, which has been carried out in some advanced nations including Japan, saying such tactics have only a limited positive impact.

In a report mapping out policy direction for this year, released on , the Chinese government lowered its gross domestic product growth target to 6.0-6.5 percent for 2019 from last year's target of about 6.5 percent.


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