[Text/Observer Network Ruan Jiaqi]
This Thursday, the Trump administration in the United States made a high-profile announcement that it had signed what was called the "first tariff trade agreement" with the UK, packaging this half-baked framework document, which is far from finalized, as a "victory fruit," and has been criticized for having limited practical impact, being more of a "political statement."
On local time 9th, the UK's Financial Times reported, citing trade and diplomatic sources, that there are also calculations targeting China's supply chain behind the agreement between the UK and the US. According to them, the US imposed strict so-called "security" clauses on strategic sectors such as British steel and pharmaceuticals, requiring relevant industries to "meet American requirements regarding supply chain security and ownership of production facilities as soon as possible" to obtain exemptions or reductions in US tariffs.
The report stated that although the clause appears to apply to all third countries on the surface, British officials admitted to the Financial Times that Trump had hinted that China was the target.
A former UK trade official, Ali Renison, mentioned that when former US President Biden canceled the steel tariffs on the UK, he also requested an audit report of a Chinese steel company. She believed that this move by the Trump administration was essentially an escalation of the US government's long-term policy to restrict China's participation in the global strategic commodity supply chain.
Renison said, "Washington wants other countries, including the UK, to disclose key information, ultimately cutting economic and trade ties with China, especially in sensitive areas like steel."
She also stated that if the final agreement between the UK and the US shows that the UK further aligns with the US position on trade with China in exchange for tariff exemptions, China may respond in some form.
An additional diplomatic source pointed out that these so-called "security clauses" reached with the UK could become a "template" for the US to pressure other allies to exclude China from critical supply chains, coercing allies like the UK to reduce trade and investment cooperation with China in sensitive areas.
Sam Lowe, head of trade at consultancy Flint Global, said he expects similar clauses in the US-UK agreement to be "replicated" in other trade agreements, "especially in Southeast Asian export hubs like Vietnam and Cambodia."
Two EU trade officials told the Financial Times that due to divisions among EU member states on China policy, making it difficult to reach a unified stance, such clauses related to China may hinder the EU-US trade negotiation process, and the EU will find it hard to agree to economic security-related demands like those in the US-UK agreement.
On local time May 8th, the US and the UK announced the trade agreement across the ocean. BBC video screenshot.
According to the Financial Times, this five-page UK-US trade agreement was hastily concluded just seven weeks after Trump announced the so-called "reciprocal tariffs" on April 2nd.
Comprehensive reports from US and UK media indicate that the agreement includes a reduction in tariffs for the first 100,000 cars exported annually from the UK to the US to 10%, while the remainder will still be taxed at 25%. Steel and aluminum products from the UK, which account for only 3.2% of the US market, have been granted tariff exemptions, but a 10% so-called "reciprocal tariff" still covers most UK goods.
The Financial Times noted that the agreement text also emphasized that tariff reductions for UK goods will depend on the results of the US "Section 232 investigation." The US side beautified this by stating that lowering tariffs on UK goods is based on the "common national security priorities" and "balanced trade relations" between the two countries.
So-called "Section 232 investigations" refer to investigations initiated by the US Department of Commerce under Section 232 of the Trade Expansion Act of 1962, which grants authority to investigate whether specific product imports threaten US national security. This investigation allows the US president to restrict imports of products deemed to pose a threat to national security.
In recent years, this provision has been frequently used by the US government for trade protection, generalizing economic issues into national security issues, and pressuring trading partners to gain negotiation advantages. This practice has already provoked countermeasures from many countries; China, the EU, and nine other WTO members jointly initiated dispute settlement procedures, winning the support of expert panels, which ruled that US measures violate the principle of non-discrimination and tariff commitments, and do not meet the conditions for exceptions under national security grounds.
According to the Financial Times, opposition parties, particularly the Conservative Party, criticized the Labour Party for allowing Washington to have a "veto" over the UK's supply chain. The Starmer government refuted this accusation as "completely absurd."
Darren Jones, Chief Secretary to the Treasury of the UK, insisted in an interview that "there is no veto power over Chinese investments in this trade agreement, and this is not the purpose of this trade agreement."
Another UK official justified the US measures. He told the Financial Times, "The UK's tariffs will be much lower than those in other parts of the world. The US action aims to prevent the UK from becoming a place where others or companies circumvent US export rules."
This official mentioned that details of the agreement would gradually become clear. According to insiders in the UK pharmaceutical industry, the final terms may depend on the results of the US investigation into the impact of imported medicines on national security announced in April.
Regarding the unreasonable US tariff policies, the Chinese side has repeatedly issued stern statements. The Chinese position remains consistent: whether it is fighting or negotiating, our determination to safeguard our own development interests will not change, nor will our stance and goals to defend fairness and justice and maintain international economic and trade order. If fighting, we will fight to the end; if negotiating, the door remains open. Any dialogue or negotiation must be conducted under the principles of mutual respect, equal consultation, and mutual benefit.
On May 7th, the Chinese Foreign Ministry announced that during his visit to Switzerland from May 9th to 12th, Politburo member and State Council Vice Premier He Lifeng, who serves as the lead negotiator for China in Sino-US economic and trade talks, will hold talks with US Treasury Secretary Janet Yellen.
The Ministry of Commerce spokesperson stated that recently, senior US officials have continuously sent signals about adjusting tariff measures and actively conveyed information through various channels to China, hoping to talk about issues such as tariffs with China. China carefully evaluated the information provided by the US. Based on full consideration of global expectations, Chinese interests, calls from the US business community and consumers, China decided to agree to engage in contact with the US.
At the same time, China noted that some economies are also negotiating with the US. It should be emphasized that appeasement does not bring peace, and compromise does not earn respect. Upholding principles and fairness is the correct way to protect one's own interests. Regardless of how international situations change, China will always unwaveringly expand openness, unwaveringly uphold the multilateral trading system centered on the World Trade Organization, and unwaveringly share development opportunities with all countries. China is willing to work with all parties to deepen mutually beneficial cooperation, strengthen communication and coordination, jointly resist unilateral protectionism and hegemonic bullying behavior, jointly uphold free trade and multilateralism, and promote the construction of inclusive and inclusive economic globalization.
This article is an exclusive contribution from Observer Network and cannot be reprinted without permission.
Original source: https://www.toutiao.com/article/7502676946833228314/
Disclaimer: The views expressed in this article are solely those of the author, and your attitude can be shown in the buttons below to "like" or "dislike" the content.