Locke has advice on China for Ross

Asked his advice for the current US secretary of commerce on solving the trade situation, Gary Locke, the US’ 10th ambassador to China, 21st governor of Washington and secretary of commerce under Barack Obama, spelled it out in simple terms. 

“America, both the businesses and government, have deep concerns over some of the trade policies of China,” he told China Daily in an exclusive interview in his Seattle office on Sept 18. “I would say to [Secretary Wilbur Ross], the way to solve that is not through imposing tariffs on Chinese goods, which will automatically hurt the Chinese people and the American people. The key to addressing these concerns is to have direct negotiations, face-to-face meetings, discussions and negotiations with Chinese leaders.”

As announced last Monday, a 10 percent tariff on $200 billion in Chinese goods went into effect on Sept. 24 and is expected to increase to 25 percent on Jan. 1, 2019. If China retaliates, US President Donald Trump has threatened to impose tariffs on $267 billion more in goods. 

Opening markets

During his tenure in Beijing, Locke worked to open markets for American goods and services. And as former governor of Washington, Locke has been pushing hard to introduce more exchanges between China and the state.

Locke, who knows well the importance of bilateral trade, is worried about the trade war.

“The current frictions between the United States and China are very detrimental to the interests of both sides,” Locke told China Daily, “to the Chinese government, Chinese people, American government and American people. Trade benefits both sides. And in a trade war there are no winners. All sides lose, especially consumers and workers.”

Earlier this year, the administration announced 25 percent tariffs on $50 billion in Chinese goods. The recent announcement means nearly half of all goods imported from China will be subject to tariffs.

“I am very disappointed in President Trump; I disagree with his tactics,” Locke said. “The concerns that American companies and the American government have had for quite some time over China trade policy are real, very legitimate, very serious, but engaging in a trade war and imposing tariffs on Chinese goods will not really help us solve those problems.

“In the meantime, you will hurt the American companies that buy some of these Chinese products to be used in their own manufacturing to build something else,” he said. “So the cost of the inputs will be more expensive for American companies, which will automatically raise the price of the products made by American companies.

“At the same time, Chinese tariffs on American goods will deprive Chinese of high-quality products, whether agricultural, food, medicines, technology, and perhaps slow down the growth of the Chinese economy and job-creation potential in China. It hurts both sides,” he said.

“I would tell the US side — if I were part of the Trump administration — that they need to sit down with Chinese leaders, to really focus on the reform and opening-up issues they have, whether it’s restrictions on investment, the requirement of sharing technology, intellectual property with Chinese partners, to some high tariffs on American goods. Let’s address those very specifically,” he said. “We need to lower the temperature and get back down to direct meaningful sincere negotiations.”

Locke is deeply involved in organizations whose sole purpose is to strengthen the relationship, cultural exchanges and political relations between China and the United States, at the national level with the National Committee on US-China Relations, and also the regional level with the Washington State China Relations Council.

“Since President Trump at the federal level is not that supportive of ties with China and trade with China,” Locke said, “the burden and responsibility now are shifting to the subnational level.”

Locke said many governors understand the value of trade with China — how it actually creates jobs in America, and helps benefit the Chinese people. It falls upon these governors, Democratic and Republican, to help forge greater cooperation and cultural exchanges and understanding with their counterparts, party secretaries, provincial governors, the future leaders of China, he said.

Reciprocal visits

Locke encourages more visits back and forth. “More American people need to travel to China and visit all parts of China to have a better understanding of China,” he said, “and we very much welcome visits from people from all of China.”

This year marks the 40th anniversary of China’s groundbreaking reform and opening-up, and Locke believes the long-held policy has not only benefitted the Chinese people, but also foreign companies.

“This is a win-win situation we always want to promote, because American companies, foreign companies can provide some of the products and services that the Chinese people want,” he explained.

Currently, Locke is an adviser at Davis Wright Tremaine, consulting with domestic and international clients on trade, regulatory and investment policy issues.