China Appoints A New Trade Negotiator During Tariff Fight With The U.S.

TAIPEI, Taiwan (AP) — China appointed a new trade negotiator Wednesday in the midst of its tariff fight with the United States as the world's two largest economies steadily increase tariffs on each other's goods.

China's government said Li Chenggang replaces Wang Shouwen, who participated in negotiations for the countries' 2020 trade deal.

China faces 145% taxes on exports to the U.S., while the Trump administration gave dozens of other countries a 90-day reprieve for most duties. Beijing has hit back at the U.S. with 125% tariffs on American exports, while stressing its determination to keep its own markets open to trade and investment.

Earlier on Wednesday, China announced its economy expanded at a 5.4% annual pace in January-March, supported by strong exports. Analysts are forecasting that the world's second largest economy will slow significantly in coming months, however, as tariffs on U.S. imports from China take effect.

Exports were a strong factor in China's 5% annual growth rate in 2024. The official target for this year is also about 5%.

In the near term, the tariffs will put pressure on China's economy, but they won't derail long-run growth, Sheng Laiyun, a spokesperson for the National Bureau of Statistics, told reporters earlier.

It wasn't clear why China was changing trade negotiators.

The decision comes as Chinese officials say the country has multiple options to respond to U.S. actions, including relying more on its own vast market of 1.4 billion consumers and on Europe and countries in the global south.

But as China's domestic consumption continues to languish, it will be difficult to replace the U.S. consumer.

China has also responded to the U.S. by imposing more export controls on rare earths, which include materials used in high-tech products, aerospace manufacturing and the defense sector.

Both sides are now running out of tariff options, leaving them in a "near-stalemate," said Sun Chenghao, a fellow at the Center for International Security and Strategy at Beijing's Tsinghua University.

China will likely retain its focus on strengthening economic resilience against external shocks, including deepening trade ties with neighboring countries and promoting domestic consumption by shifting away from exports, Sun said.

A U.S. concession on fentanyl or ownership of TikTok could prompt a reciprocal move from Beijing, he added.

However, communication remains "far from being smooth," Sun said, pointing out that Trump only recently appointed Jamieson Greer as top trade negotiator, and many other key positions remain empty.

Prior to his appointment as trade negotiator, Li spent about 4 1/2 years as China's ambassador to the World Trade Organization, the body that governs global commerce. Beijing has appealed to it in its tariff dispute with the U.S.

Li was also deputy permanent representative to the Chinese delegation to the U.N. office in Geneva and other international organizations in Switzerland.

Perhaps more so than his predecessor Wang, Li's experience at the Commerce Ministry and his participation in negotiating China's accession to the WTO more than 20 years ago stand him in good stead as China refuses to cave in to U.S. demands, said Tu Xinquan, director of the China Institute for WTO Studies at the University of International Business and Economics.

Still, higher-ranking leaders from President Xi Jinping on down are likely to chart the course, with Li representing their case in any talks with the U.S., Tu said.

"There might be another style of negotiations. Li Chenggang is an open-minded person and supports free trade," Tu added.

Asked about the possibility of talks with the U.S., Chinese Foreign Ministry spokesperson Lin Jian said the U.S. had begun the tariff spat and China was only taking "necessary countermeasures" to defend its rights and interests.

"If the U.S. truly wants to resolve the issue through dialogue and negotiation, it should stop using maximum pressure and stop threats and blackmail. For any dialogue to happen, it must be based on equality, respect and mutual benefit," Lin told a daily briefing.

Xi has been making the case for China as a source of "stability and certainty" in global free trade as he tours Southeast Asia this week — implying that China is a more reliable trade partner than the U.S.

After visiting Vietnam, he arrived in Kuala Lumpur, Malaysia's capital, later Tuesday, for a three-day visit and will end with a stop in Cambodia. In Malaysia, Xi is expected to discuss a free trade agreement between China and the 10-member Association of Southeast Asian Nation, one of several funds and agreements China has led as a means of sidestepping organizations and mechanisms dominated by the U.S. and the West.