US-China Disagreement ‘Torpedoes’ Pacific Accord Summit, No Communiqué Issued

For the first time in 29 years, the summit ended in a bitter feud with no communiqué. Chinese officials escorted away.

At the Asia Pacific Accord Summit, host nation Papua New Guinea accused Chinese officials of intimidation. The Chinese officials were escorted away. For first time in 29 Years, APEC Fails to Issue a Communiqué

A summit of world leaders ended in acrimony Sunday with the host nation accusing Chinese officials of threatening behavior and differences between the U.S. and China preventing delegates from reaching a consensus on trade, security and investment.

Chinese officials demanding a meeting with Papua New Guinea’s foreign minister forced their way into his office Saturday and had to be escorted away by police after a confrontation, according to two senior officials from the host country. China denied the incident happened, dismissing the accounts as “malicious rumors,” and local police didn’t respond to a request for comment.

The midlevel Chinese officials had sought the meeting to voice their unhappiness with the draft language of a proposed statement, an official briefed on the episode said.

For the first time in the summit’s 29-year history, officials ended two days of meetings without issuing a communiqué, with Papua New Guinea’s leader delivering only his summary of failed talks. “You all know who the two big giants in the room were, so what can I say,” Prime Minister Peter O’Neill told reporters.

A senior Trump administration official said Sunday that the dispute largely came down to a single proposed sentence: “We agreed to fight protectionism including all unfair trade practices.”

China wouldn’t agree to that language, believing it amounted to a “singling out” of Chinese trade practices, the U.S. official said. All other 20 APEC nations favored including the language in the final communiqué, the official said.

Meaningless Statement

Ironically, the statement that caused this incident is innocuous. In prior years, nations agreed to similar statements while doing nothing about it for decades. The US, EU, and China are all guilty of stupid tariffs and unfair trade practices.

Typically these summits end with a bunch of infighting over agricultural tariffs with the US saying it would end agricultural tariffs if the EU would.

That's a safe position by US protectionists because France would never agree to end agricultural tariffs, and France holds an effective EU veto.

You First

You first is precisely why these summits are a waste of time. No country is willing to lead the way.

As I have stated many times, a good trade agreement can be written on a napkin with a crayon:

"Effective immediately, all tariffs and all subsidies on all goods and services are eliminated." The first country to do that, regardless of what any other country does, would be an enormous winner.

Tariffs are Insane

Note that Alan Greenspan Says Trump's Tariffs are "Insane" and He's Right.

China doesn't play fair? So what?

Please consider Reflections and Reader Comments on Free Trade: “China Doesn’t Play Fair!

Mike "Mish" Shedlock

Comments
No. 1-12
sunny129
sunny129

Greenspan

sunny129
sunny129

Globalization unfairly favors the advantage of mobile CAPITAL continue to exploit labor anywhere in the World. The global wage worker including those in USA, is at the receiving end of this policy, favored by top1%, Us mulriNationals and the Wall St.

Asset managers like Mish in control huge capital prefers the status quo. Basically it is the Capital vs hapless wage worker (labor). I also has realized the advantage as a global investor. But let's call a spade, a spade! Rest is hogwash!

Schaap60
Schaap60

I reread the 2016 post and the reference to the 500 underwear workers losing their jobs raises an important issue. Does the outsourcing of low and mid skill jobs to other countries make competition for those jobs stronger in the US, thereby depressing wages?

Wages for roughly the bottom 80% of wage earners have stagnated since the 1970s, which coincides with the era of trade liberalization and globalization. Since the 1970s virtually all income gains have gone to the top 20% of wage earners, with most of that going to the top 1%. Many workers, correctly or not, connect the two issues. Are the issues unconnected? Telling workers they don't understand how much they benefit from free trade is not going to pacify disaffected people who have struggled economically for decades.

It also appears the highest earners benefit twice from free trade: First, they have access to cheaper imported goods. Second, competition among workers displaced by freer trade keeps wages down for other goods and services consumed by wealthier people. Even if that assessment isn't correct, I think it sums up what many workers think is happening.

Mike Mish Shedlock
Mike Mish Shedlock

Editor

"I'm sure great suffering will result from lack of yet another communique"

Yes, I was extremely heartbroken and almost in tears.

Mike Mish Shedlock
Mike Mish Shedlock

Editor

"I don't understand why you keep mentioning Greenspan he's a proven idiot"

There are all kinds of proven idiots. Paul Krugman comes to mind. But sometimes I agree with him. For example, I sided with Krugman against the hyperinflationists.

It is as rare for someone to be always wrong as it is always right. Greenspan had a particularly useful talent.

The more people believed him the more likely he was to be wrong. Very useful!

The worst set of people are those randomly right or wrong.

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