<p>&ldquo;We do not want to see any trade war breaking out between the two countries,&rdquo; said Chinese Prime Minister Li Keqiang this week during China&rsquo;s annual parliament session. ;</p>
<p>&ldquo;That would not make our trade fairer and would harm both sides,&rdquo; he continued, suggesting that such a war would hurt America more than it would hurt China. ;</p>
<p>PM Li says China&rsquo;s trade and investment relationships with the US created as many as 1 million American jobs last year.</p>
<p>Economist Christopher Balding argues that &ldquo;China is much more dependent on trade with the US as a percentage of GDP&rdquo; and says it would be easier for American firms to reorganize supply chains than for China to alter its industrial structure. ;</p>
<p>&ldquo;The world pays attention to China-US relations,&rdquo; said Li, &ldquo;so our hope on the Chinese side is that no matter what bumps the China-US relationship hits, we hope it will continue to move forward in a positive direction.&rdquo; ;</p>
<p>US Secretary of State Rex Tillerson landed in Tokyo on Wednesday and will make his first trip to China later this week. US-China relations will be among his topics of discussion, but the most important talking point will be North Korea&rsquo;s nuclear program. ;</p>
<p><a href="https://punchingbagpost.com/us-south-korea-operations-create-tension-with-n-korea-and-china/" target="_blank"><strong>As I wrote earlier this week</strong></a>, US-South Korea military operations east of the peninsula have earned criticism from China and threats from North Korea. ;</p>
<p>&ldquo;Tensions may lead to conflict, which would only bring harm to all the parties involved,&rdquo; said Li. &ldquo;It&rsquo;s just common sense that no one wants to see chaos on his doorstep.&rdquo; ;</p>
<p>President Donald Trump has been tough on China throughout his campaign, threatening to levy a high tax on imported goods and to label China a &ldquo;currency manipulator.&rdquo; He has criticized China&rsquo;s apparent lack of concern in dealing with North Korea and its growing nuclear capabilities.</p>
<p>China was furious with Trump in December when he spoke with Taiwanese President Tsai Ing-wen and implied that the US did not necessarily need to stick to the &ldquo;one China&rdquo; policy.  ;</p>
<p>Chinese President Xi Jinping is expected to fly to the US to meet face-to-face with President Trump at his Florida estate in April. Personal chemistry (or lack thereof) between the two leaders will be key in future negotiations. ;</p>
<p><strong>Author&rsquo;s Note:</strong> When you haggle, the seller always starts with a price he knows he won&rsquo;t receive and the buyer starts with a price he knows he won&rsquo;t pay. ;</p>
<p>Much of the verbal sparring between Trump and China is simple posturing. Unlike Obama, who couldn&rsquo;t negotiate his way out of a paper bag, both China and the Trump Administration understand the basics of negotiation. Each side is establishing a hard line now so that a &ldquo;middle ground&rdquo; can be reached in the future. ;</p>