US, China in feisty clash on trade, influence at APEC

United States Vice-President Mike Pence told a gathering of business leaders at the Asia Pacific Economic Co-operation summit that there would be no backing down from tariffs until China changed its ways.

With the upcoming visit of Chinese President Xi Jinping to the Philippines, the maritime law expert said the visit "should be a major milestone in the improved relations of the Philippines and China".

"This is a short-sighted approach and it is doomed to failure", he added, warning those who close their doors "will only cut himself off from the rest of the world and lose his direction".

He also announced the United States would join with Australia in the development of a new naval base.

President Trump will be meeting with his Chinese counterpart Xi Jin Ping at the G-20 summit in Argentina later this month. "We don't drown our partners in a sea of debt, we don't coerce, or compromise your independence", Pence said.

The Trump administration has levelled tariffs on US$250 billion in goods from China, over complaints of deep state subsidies for businesses and intellectual property theft.

Pence also attacked China's global infrastructure "Belt and Road" initiative, calling numerous projects low quality and saying it left developing countries with debt they were unable to afford.

President Donald Trump made a decision to skip the summit in Papua New Guinea, leaving the door open for Xi who arrived two days earlier for a state visit and has been the undoubted star of the show.

"We have taken decisive action to address our imbalance with China", he said.

The vice president harshly criticized China's global infrastructure drive, known as the "Belt and Road Initiative", calling numerous projects low quality that also saddle developing countries with loans they can't afford.

Xi lashed out at "America First" trade protectionism and in a thinly veiled swipe at Washington stressed that global trade rules should not be applied "with double standards or selfish agendas".

"History has shown that confrontation - whether in the form of a cold war, a hot war or a trade war - will produce no winners", he said.

Xi defended the Belt and Road Initiative, saying it "is not a trap as some people have labelled it".

The Pences were in Papua New Guinea so that the vice president could participate in the Asia-Pacific Economic Cooperation Economic Leaders meeting, which brings together leaders, ministers and senior officials of APEC's 21 member nations.

But on Saturday Xi appeared to give no concessions to U.S. complaints that China's technology advances had been built on intellectual property theft.

"Mankind has once again reached a crossroads", Xi remarked.

"What we should do is to lose no time in making every effort to explore new growth drivers and development paths, and remove all institutional obstacles holding back innovation", he said.

"As we look back over the four decades of reform and opening-up, we in China are more convinced than ever before that only through reform and opening-up can China develop itself", Xi said. The United States deals openly, fairly.

Before the APEC dummit Mr O'Neill said he "wasn't interested" in geopolitics, and wanted to work with everyone.

The anti-protectionism sentiment was also echoed by the Chinese president, Xi Jinping.

  • Tracy Klein