ArrowArtboardCreated with Sketch.Title ChevronCrossEye IconIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Trade War

Trump says trade deal with Beijing must include 'structural change'

In State of the Union speech, president also asks for retaliatory trade bill

President Donald Trump delivers the State of the Union address at the Capitol in Washington on Feb. 5.   © Reuters

WASHINGTON/TOKYO -- U.S. President Donald Trump on Tuesday renewed his call for China to make structural changes to its economic policy, further pressuring Beijing ahead of a March 1 deadline to defuse trade tensions between the world's two largest economies.

The U.S. is "now working on a new trade deal with China," the president said in his State of the Union address to the Congress. "But it must include real, structural change to end unfair trade practices, reduce our chronic trade deficit, and protect American jobs."

"We are now making it clear to China that after years of targeting our industries, and stealing our intellectual property, the theft of American jobs and wealth has to come to an end," the president said.

The bitter dispute between Washington and Beijing has unnerved the rest of the world and disrupted global economic activity. Trump and Chinese President Xi Jinping agreed in Buenos Aires on Dec. 1 to a 90-day trade truce to give dialogue a chance.

Next week, Washington is sending senior officials, led by U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, to Beijing to start a new round of talks with their Chinese counterparts, a last-minute effort to avert an increase in U.S. tariffs on Chinese goods that would start on March 2, according to The Wall Street Journal.

In the State of Union address, Trump made no mention of a possible meeting with Xi, indicating that more working-level negotiations are needed and that the talks are nowhere near conclusion.

Washington has shown little sign of easing the pressure on Beijing. Last month, the U.S. Justice Department indicted Huawei Technologies, one of China's most successful technology companies and the world's largest telecom equipment maker, on charges of intellectual property theft and U.S. sanctions violations. Washington is also seeking the extradition of Huawei executive Meng Wanzhou, daughter of the company's founder, from Canada.

The U.S. government has also been accusing Beijing of using modern technology to build a surveillance state to restrict the free flow of information. Many see the ongoing trade war as a fight for technological leadership in the coming century.

President Donald Trump delivers the State of the Union address at the Capitol in Washington, DC on Feb. 5.   © AP

In the speech, Trump stressed the need for "investments in the cutting edge industries of the future" to stay ahead of rivals. "This is not an option. This is a necessity," he stressed. The range of emerging technologies include artificial intelligence and 5G wireless networks, into which China has been pouring billions of dollars to boost its competitiveness.

China is not the only target of Trump's "America first" trade campaign. He urged Congress to pass the Reciprocal Trade Act, which mandates matching steps against any tariffs imposed by other countries. The president's call suggests the U.S. government will not hesitate to implement retaliatory measures, even against longtime allies such as the European Union and Japan.

Meanwhile, Trump touted his diplomatic engagement with North Korea, despite warnings from experts in and outside the U.S. about Pyongyang's intentions for its nuclear weapons program.

"As part of a bold new diplomacy, we continue our historic push for peace on the Korean Peninsula," Trump said.

He highlighted the absence of new missile launches by North Korea in the past 15 months. "We would right now, in my opinion, be in a major war with North Korea" had it not been for Trump's election, the president said.

The remarks came as his top envoy, Stephen Biegun, is scheduled to hold talks in North Korea to lay the groundwork for a summit between Trump and North Korean leader Kim Jong Un, which Trump announced will take place in Vietnam on Feb. 27-28.

The diplomatic offensive came as the U.S. intelligence community and the United Nations warn that North Korea is moving ahead with its nuclear development program while talking of "denuclearization."

Biegun conceded in a speech at Stanford University on Jan. 31 that Washington and Pyongyang have no agreement on what denuclearization should achieve.

U.S. allies in the region are concerned that Trump might strike a deal with Pyongyang that would eliminate threats to the U.S. but not those to Japan and other friends in the region.

"Much work remains to be done, but my relationship with Kim Jong Un is a good one," Trump said.

On the U.S. economy, Trump touted the first two years of his administration. The U.S. economy is "growing almost twice as fast today as when I took office," he said. Unemployment has reached the lowest rate in half a century, and business confidence has been boosted by tax cuts and deregulation.

"Members of Congress: the State of our Union is strong," he said. "Our country is vibrant and our economy is thriving like never before."

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends January 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media