United States, China in feisty clash on trade, influence at Asia-Pacific Economic Cooperation

November 17, 2018

PORT MORESBY - China and the United States traded heated barbs Saturday ahead of an APEC summit, lashing out at each other over protectionism, trade tariffs and "chequebook diplomacy" in the region.

In duelling back-to-back speeches at a pre-APEC business forum, China's President Xi Jinping and US Vice-President Mike Pence pulled few punches, laying out sharply contrasting visions for the region of 21 countries.

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".

The world's top two economies have been embroiled in a spiralling trade war, imposing tit-for-tat tariffs on each other's goods in a confrontation that experts warn could torpedo the global economy.

Xi urged the world to "say no to protectionism and unilateralism", warning it was a "short-sighted approach and it is doomed to failure".

For his part, a combative Pence warned that US tariffs would remain in place unless Beijing "changes its ways".

"We've put tariffs on $250 billion in Chinese goods and that number could more than double," he told CEOs from around the region.

"We hope for better, but the United States will not change course until China changes its ways."

President Donald Trump decided 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.

The APEC summit of leaders from 21 countries across the region has developed into a tussle for influence between an increasingly assertive China and a more withdrawn US.

In contrast to Trump, Xi arrived before the summit, opening a new road and a school in Port Moresby and holding talks with Pacific Island leaders.

Papua New Guinea rolled out the red carpet for the Chinese leader, with dozens of people from various tribes serenading him sporting parrot feathers, possum pelts and seashell necklaces.

'Constricting belt'

In his speech, Pence lashed out in unusually strong terms at China's Belt-and-Road initiative that sees China offering loans to poorer countries in the region to improve infrastructure.

The vice-president encouraged Pacific nations to embrace the United States, which, he said, did not offer a "constricting belt or a one-way road".

He said the terms of China's loans were "opaque at best" and "too often, they come with strings attached and lead to staggering debt".

As if pre-empting the criticism, Xi defended the plan amid attacks that it is akin to "chequebook diplomacy" to further Chinese interests in the region.

He denied there was a "hidden geopolitical agenda... nor is it a trap as some people have labelled it".

And the Chinese leader warned that no one would gain from heightened tensions between the US and his emerging superpower.

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

Pence too stressed that Washington wanted a "better relationship" with Beijing.