‘Numbers that you haven’t even thought about’: Trump threatens China with a ‘fine’ over trade

Expectations are rising (again) of substantive tariffs on Chinese goods being implemented by the United States. In an interview with Reuters, U.S. President Donald Trump said, “we have a very big intellectual property potential fine going, which is going to come out soon.” Trump then boasted that the potential fine would be in “numbers that you haven’t even thought about.”

• “Soon” may actually mean soon, in this case, because the U.S. Trade Representative (USTR) has been investigating for “unreasonable or discriminatory” Chinese trading practices since last August. Gary Cohn, an economic advisor to Trump, confirmed that the USTR recommendations were nearly ready.
• Trump will give a State of the Union address to the U.S. Congress on Jan. 30, and Trump “said he would be announcing some kind of action against China over trade and said he would discuss the issue” during the address, according to Reuters.
• Another factor at play: Trump’s bark needs to be soon paired with a bite, or China may conclude he is “just another American paper tiger,” Bill Bishop notes (paywall) in Sinocism.

More reporting — all from Reuters, which is sparing no effort for this beat — on U.S.-China trade tensions, prospects, and trends:

• China expresses doubts over credibility, objectivity of U.S. report on fake goods / Reuters
  The USTR “has put Alibaba’s Taobao on its blacklist for the second year in a row over suspected counterfeits sold on the shopping platform.”
• United States wins WTO chicken ruling against China / Reuters
  “Beijing has failed in a bid to use one of Washington’s own favorite trade policy tools – punitive tariffs – against U.S. producers, and will be obliged to lower its tariffs [on broiler chickens], unless it appeals within 20 days.”
• U.S. clears Chinese acquisition in rare move / Reuters
  “Beijing-based Naura Microelectronics Equipment Co Ltd has completed a deal to buy U.S. semiconductor manufacturing equipment company Akrion Systems LLC.” Though the deal is worth just $15 million, it is striking for a deal in the sensitive semiconductor industry to go forward.
• Chinese automaker’s U.S. market drive runs into Washington opposition / Reuters
  “Chinese automaker GAC Automobiles’ plan to sell vehicles in the United States ran afoul of Washington trade politics on Wednesday, as the top U.S. Senate Democrat and U.S. President Donald Trump separately criticized Chinese trade practices.”

• Hotels
  Muji’s first hotel opens in Shenzhen / Caixin
  “A second Muji hotel will open in Beijing in March, followed by a third one in Tokyo in the spring of 2019.”
• Real estate
  China’s hot housing market begins to cool / WSJ (paywall)
  “In Beijing and Shanghai — two of China’s largest housing markets — and other megacities, property sales have stalled and prices have dropped, and the high levels of debt that fueled a housing boom make the slowdown particularly perilous.”
• Petroyuan
  China’s bid to upend the global oil market / Foreign Policy (paywall)
  “Could a new oil futures contract mark a seismic shift in Beijing’s efforts to globalize its currency?”
• Fluctuating yuan
  China says yuan gains market-driven, two-way swings will be the norm / SCMP
• Damned lies
  China’s 2017 GDP growth accelerates for first time in seven years / Reuters
  See also the New York Times analysis (paywall) of the numbers.
• Healthcare and tech
  Shanghai-based healthcare startup The CareVoice completes $2 million investment round / TechNode
  J&J attracts Chinese interest for diabetes business in potential $3-4 billion deal – sources / Reuters
• Film industry
  ‘Secret Superstar’ blazes new trail for Indian cinema in China / Sixth Tone
• Mobile payments
  Shanghai Metro enables mobile payments as Alipay and WeChat Pay go into battle over public transportation / TechNode
  Mobile-payment fraud rises in China, report finds / Caixin