Executive Intelligence Review


China and U.S. Hold Key Talks This Week, as Trump’s Enemies Aim New Provocations at Beijing

Jan. 29, 2019 (EIRNS)—Top Chinese government officials will arrive in Washington this week to continue with the crucial trade talks between the two countries, as mandated by Presidents Donald Trump and Xi Jinping. As an indication of the importance Trump places on the meetings, he is planning to meet personally with China’s top negotiator, Vice Premier Liu He, according to a statement issued yesterday by Treasury Secretary Steven Mnuchin. The U.S. delegation will be led by Trade Representative Robert Lighthizer, and will include Mnuchin, Secretary of Commerce Wilbur Ross, and White House economic advisors Larry Kudlow and Peter Navarro, according to Bloomberg. Said Mnuchin: “We have another 30 days after this” to reach an agreement before the March 1 deadline Trump and Xi agreed to. “My expectation is that we will make significant progress.”

On cue, the President’s enemies unleashed their measures clearly designed to sabotage those talks, and any good relations between the U.S. and China. The U.S. Justice Department yesterday filed a total of 23 criminal charges against Chinese telecom giant Huawei and its Chief Financial Officer Meng Wanzhou, earlier arrested Dec. 1 in Canada—a 13-count indictment in Brooklyn, New York, and a 10-count indictment in Washington state. The charges include bank and wire fraud, obstruction of justice and theft of technology. As BBC reported, the U.S. charges come one day after Canada fired its ambassador to China, just after he publicly argued that the U.S. extradition request for Meng was seriously flawed. U.S. Commerce Secretary Wilbur Ross told the press that the Huawei charges were “wholly separate” from the ongoing trade negotiations. But, as Bloomberg commented, “any expectation for big progress was complicated by growing tensions between the two countries over Huawei.”

A few days before that, on Jan. 24, Goldman Sachs issued a report warning its clients about companies that have significant sales or other operations in China. They specifically targeted firms Nvidia, Broadcom, Micron Technology, Qualcomm, Qorvo, Skyworks Solutions and Wynn Resort. Goldman noted those seven companies get more than half their sales from “Greater China.”

Lo and behold, shares of Nvidia plunged by 17% on Jan. 28, after the company lowered its “revenue guidance” for the fourth quarter of 2018, in large measure due to “deteriorating macroeconomic conditions, particularly in China.” As CNBC reported, “Caterpillar stock fell more than 9% on Jan. 28 after the company pointed to tariffs and a slowdown in China as major factors in its disappointing fourth-quarter results.”