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Xi eyes more open economy as China, U.S. trade spat widens

AFP BEIJING (AFP-Jiji) — Chinese President Xi Jinping pledged on Tuesday to lower car tariffs this year and take other steps to further open the world’s No.2 economy, indirectly addressing major complaints by the United States in a simmering trade row.

Promising a “new phase of opening up,” Xi told an economic forum on the southern island of Hainan that Beijing “does not seek a trade surplus” and hopes to increase imports.

He said China will take measures to liberalize automobile investment, significantly reduce tariffs on cars this year and protect intellectual property — all areas that have been high on the list of demands by Washington.

“Economic globalization is an irreversible trend of the time,” Xi told the Boao Forum for Asia.

“The door of China’s opening up will not close, it will only open wider and wider.”

Xi pushed measures in areas that have been high on the list of U.S. President Donald Trump’s ire at China.

“When a car is sent to the United States from China, there is a Tariff to be paid of 2½%. When a car is sent to China from the United States, there is a Tariff to be paid of 25%,” Trump tweeted on Monday.

“Does that sound like free or fair trade. No, it sounds like STUPID TRADE — going on for years!”

Without directly responding to Trump, Xi promised China would lower import tariffs for vehicles and other products, but he gave no details or an exact date for taking the measures.

Beijing’s restrictions on foreign ownership in the auto sector have forced foreign companies to partner with Chinese firms and share their technology.

Elon Musk, CEO of electric car giant Tesla asked for Trump’s help on the issue this year, alluding to the troubles his firm has faced to producing in China.

Xi said those restrictions would be liberalized, pledging “to quickly relax restrictions on foreign shareholding, especially the restrictions on foreign investment in the automobile industry.”

Asia markets — hammered along with global equities by the trade row in recent weeks — rallied on the speech Tuesday.

The threatened tariff war was spurred by a U.S. Trade Representative investigation into China’s intellectual property practices, which alleged wide-scale theft and forced technology transfers.

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