TOKYO, May 18, 2018 /PRNewswire/ – Mizuho DKB Brokerage has highlighted that China has offered to reduce its annual trade surplus with the United States by $200 billion.
In a proposal submitted by the Chinese side, Beijing trade representatives said they can ease trade imbalance through increasing US imports and reducing tariffs noted a key research analyst from Mizuho DKB Brokerage.
This figure is more than double the amount the U.S. requested earlier this year, which amounted a $100 billion cut. China’s trade surplus hit a record $375 billion last year.
One of the sources said that Liu He, President Xi Jinping’s top advisor, said that Beijing plans to cut its trade surplus though increased purchases of US goods and other measures, including halting government subsidies for high-tech industries and sharply cut import tariffs on American exports.
Another person familiar with the talks said the package may include buying more commercial aircraft from US maker Boeing, which is already selling nearly 30 percent of its production to the mainland. China’s two biggest imports from the United States in 2017 included aircraft at $17 billion and soybeans at nearly $12 billion.
The Chinese delegation also proposed to lower some tariffs to levels no higher than those imposed by the United States. Nearly $10 billion worth of US farm products would be a major beneficiary of the Chinese offer including fruit, nuts, pork, wine and sorghum.
Mizuho DKB Brokerage commented to its investors the importance on the Chinese officials providing a few details on their demands in exchange for the concessions aimed at bringing down the U.S. trade deficit.
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The United States has already eased sanctions on Chinese telecom equipment maker ZTE Corp. However, Beijing was asking to treat Chinese investment equally under national security reviews and to set aside threats of imposing 25% tariffs under its “Section 301” probe.
Mizuho DKB Brokerage analysts reported that China wanted a relaxation of US restrictions on investments made by Chinese companies, including controls that ban US suppliers from selling certain high-technology products to Chinese clients.
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SOURCE Mizuho DKB Brokerage
