One of the most interesting moments at the recently concluded Waterways Symposium came in a parenthetical remark by keynote presenter Allen Sinai, a well-known economist and forecaster. Sinai said that like most economists, he supported and spoke in favor of free trade for years. Now, he said, in a remarkable about-face, “Fair trade is better.”
At the upcoming Group of 20 (G20) trade meeting in Argentina, from November 26 through December 1, President Donald Trump is expected to meet one-on-one with Chinese President Xi Jinping. Stephen Censky, deputy secretary of the U.S. Department of Agriculture, hinted at the symposium that positive developments might be announced follow the meeting. They would be welcome; Censky acknowledged that U.S soybean farmers have been China’s biggest target in its tariff dispute with the U.S.
Censky said the trade dispute between the U.S. and China could be resolved “in a matter of months,” and added, “We need not just commitments from China on intellectual property and access issues, but commitments for major agriculture buys.” He said U.S. ag exports “could come roaring back fairly quickly.”
China was finally allowed into the World Trade Organization in 2011 after years of trying. That membership boosted China’s economy as well as that of exporters around the world—including American soy farmers. Fair trade supporters hoped that WTO membership would end restrictive Chinese practices like forcing foreign companies to turn over proprietary technology and trade secrets as a condition of doing business in China. But that has not happened. China’s critics, including President Donald Trump, have charged (with much supporting evidence) that China never abandoned the unfair and restrictive trade practices that run counter to the WTO’s goals and practices.
The recently concluded meeting in Papua New Guinea of the 21-nation Asia-Pacific Economic Cooperation (APEC), attended by President Xi and U.S. Vice President Mike Pence, was a public-relations disaster for China. It ended with no joint communique for the first time in its 25-year history.
China was forced on the defensive about its restrictive trade practices and its Belt and Road infrastructure initiative, whose multi-billion-dollar infrastructure projects in neighboring countries financed by opaque Chinese loans are being called “debt traps.” In a speech, Pence singled out China when he said that the U.S. deals openly and fairly with other countries, offering “no constricting belt or one-way road.” He told Indo-Pacific countries not to surrender their sovereignty: “Just like America, put your own countries first.”
By the G20 meeting, China may be desperate for some kind of trade agreement to show the world. America’s soybean farmers would certainly welcome a trade resolution, and so would the barge lines that haul their beans.