CGTN's Mike Walter spoke to Marc A. Ross about what many believe is a looming US-China trade war. Ross is the founder of Caracal Global, an international communications and management company.
The Trump administration is set to unveil a package of punishing measures just after high-noon today all aimed at China, including billions in new import tariffs (or better put - consumer taxes).
The White House is seeking to clamp down on what it says are improper Chinese trade practices and lax intellectual property rights by making it significantly more difficult for China’s companies to acquire advanced American technology or invest in American companies.
Few disagree on both sides of the Pacific that Beijing needs to do more to open its markets to foreign competition, improve intellectual property protection, and provide a level playing field for all businesses operating in the Middle Kingdom.
The disagreement is in how this all happens.
It is still unclear how a strategy of using tariffs will move the needle.
Not only will the American consumer feel the burden with fewer funds to spend, but companies operating with long-term vision also now need to create a new playbook,
MBA 101 tip, for companies to be successful, they need predictability and want to see problems fixed productively without friction.
Think solutions, not sanctions.
For me, it’s just not clear how tariffs get you to fix these problems.
Listed on the official White House schedule as "THE PRESIDENT signs a Presidential Memorandum targeting China’s economic aggression," this memo will change global business in ways unknown but known is in the fact that power of multinational corporations has peaked and the future American elections will never be the same.
Even with just hours to go, final details of Trump's plan, including the number of imports to be hit by tariffs, remain in flux and full of Twittersphere speculation.
Since Trump will just be singing a memo today, the tariffs won’t be imposed immediately, giving American business, lobbyists, and special interests an opportunity to comment and suggest which products should be subject to the duties. James Madison's faction theory will be in full effect in the nation's capital.
Trump’s metals tariffs are already taxing patience. The LAT reports, the Trump administration’s tariffs on imported steel and aluminum are set to take effect Friday, but the rollout is being criticized as confusing, rushed, and potentially crisis-inducing. Have fun dropping off products at the Port of Los Angeles next week, next month, next year.
Whatever the final details become, this issue will linger for years.
Not only do companies now face a two-sided problem of needing to engage both Beijing and DC in respected fashions, but it is hard to see how this action doesn't shape the 2018 and 2020 elections - being tough on China makes American voters feel good.
Also, be mindful that as the CW inside the beltway is all focused on US-China commercial relations, Brussels has a say as well.
As Trump makes "Ameican First" moves, the Europen Union is holding firm in the background. This memo will undoubtedly strengthen the EU. As the biggest trading block in the world, they can flex their power and be more selective, stable, and secure - all attributes global business likes.
Enjoy the ride.
Marc A. Ross is the founder of Caracal Global and specializes in global communications and thought leader management at the intersection of politics, policy, and profits. Working with boardrooms and C-Suite executives from multinational corporations, trade associations, and disruptive startups, Marc helps leaders create compelling communications, focused content, and winning commerce.
Bitcoin, Trade Clash, Huawei, Starbucks, Lego, Social Media News
Caracal Insider Daily
January 16, 2018
Curation and commentary from Marc A. Ross
Reporting from Alexandria, Virginia
Caracal Insider = Global Business News at the Intersection of Politics + Policy + Profits
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TOP FIVE
✔️ Bitcoin plunges 20%
✔️ Lawmakers urge AT&T to cut ties with Huawei
✔️ US and China prepare for trade clash
✔️ A new Starbucks opens in China every 15 hours
✔️ Half of Americans want to regulate social media news
GEOECONOMICS
Bitcoin plunges 20%: The price of bitcoin plunged by as much as 20% amid concerns about tighter regulation falling below $12,000 for the first time since early December.
France wants tougher rules on bitcoin to avoid criminal use: AP reports, France’s finance minister says he wants new regulation targeted at virtual currencies, to stop them from being used for tax evasion, financing terrorism, and other crime.
WSJ: Oil briefly reaches $70 as buoyant global economy bolsters demand
Battle stations: US and China prepare for trade clash of the titans: A trade war between the U.S. and China would be more bruising and protracted than the battles that raged in the 1980s over Japanese exports and would risk taking down the entire global trading architecture.
WSJ - Andrew Browne
"The last time Washington mobilized for a trade war, Ronald Reagan was president and Japan the adversary."
China disrupts internet access for global groups: FT reports, companies fear being forced on to expensive platform surveilled by Beijing.
Lawmakers urge AT&T to cut ties with Huawei: Reuters reports, US lawmakers are urging AT&T, to cut all commercial ties to Chinese phone maker Huawei Technologies and oppose plans by telecom operator China Mobile to enter the American market because of national security concerns. The lawmakers are also advising US companies that if they have ties to Huawei or China Mobile - like partnering on 5G or selling handsets - it could hamper their ability to do business with the US government.
China fake data mask economic rebound: FT reports, GDP numbers unlikely to show the scale of recovery because of previous moves to hide slowdown.
Bloomberg: Xi Jinping’s debt clampdown has left a trail of dead projects
"As consumption sustains growth, once-prized programs lie idle"
China admits to having agents in Canada as former judge harassed in Toronto: Globe and Mail reports, for more than 15 years, the Chinese government has provoked anger in Canada, Australia, the United States and elsewhere for sneaking security agents abroad
Days after Hawaii alert gaffe, Japan issues a false alarm about a missile launch: Reuters reports, Japanese public broadcaster NHK issued a false alarm about a North Korean missile launch on Tuesday, just days after a similar gaffe caused panic in Hawaii, but it managed to correct the error within minutes.
WP: North Korea calls Trump a ‘lunatic’ and a ‘loser’ in response to nuclear button tweet
NK nukes - no: Foreign ministers from around 20 nations will gather for a meeting in Vancouver today, co-hosted by the U.S. and Canada, to discuss how to curb North Korea’s nuclear ambitions. But China, seen as a key player in any long-term solution, will be absent.
Donald Tusk calls for a second Brexit referendum: The Time reports, Donald Tusk has called on Britain to reverse the decision to leave the European Union with a second referendum or a House of Commons vote on the final Brexit deal. The president of the European Council made his appeal as pressure grows on MPs to press for a second referendum or to reject a withdrawal agreement.
The Times: Le Pen plans to rename and rebrand National Front
Italy falls for nostalgia: Don't blame only the politicians. Italian voters are also fed up with "reform."
Bloomberg - Ferdinando Giugliano
"Nostalgia, welcome back to Rome."
America last? EU says Trump is losing on trade: Reuters reports, the European Union’s trade tsar has no idea what Donald Trump will tell his audience at the World Economic Forum in Davos next week, but she is clear what the EU’s message to the U.S. president will be. America is shooting itself in the foot by withdrawing from global leadership on trade, Cecilia Malmstrom, the 49-year-old Swede who has served as Europe’s trade commissioner for the past three years, told Reuters.
AMERICAN POLITICS
WP: Chances of shutdown grow as GOP turns to short-term spending deal for government
Bloomberg: GOP leaders struggle to avert shutdown after immigration blow-up
The US government runs out of money at midnight on Friday.
Today: Trump meets with President Nursultan Nazarbayev of Kazakhstan.
Slate: The cannabis industry is well-armed to fight Jeff Sessions https://goo.gl/RJnpYP
The Pentagon is planning to develop two new sea-based nuclear weapons to respond to Russia and China’s growing military capabilities.
Flu bug USA: The entire continental US is experiencing widespread flu right now, the first time in the 13 years of the current tracking system that this has happened.
ENTERPRISE
Fiat Chrysler CEO Sergio Marchionne said Monday he has no plans to sell its Jeep business or split up the company.
CNBC: Ford plans $11 billion investment, 40 electrified vehicles by 2022
Autonomous technology and automobiles: US Transportation Secretary Elaine Chao told a Detroit auto show forum that the Trump administration is planning to unveil revised self-driving car guidelines this summer.
AFP: Qantas changes website to recognize Chinese territories
Adidas wants to increase its US market share to around 15%-20%.
Alibaba's AI outguns humans in a reading test: Bloomberg reports, Alibaba put its deep neural network model through its paces last week, asking the AI to provide exact answers to more than 100,000 questions comprising a quiz that’s considered one of the world’s most authoritative machine-reading gauges. The model developed by Alibaba’s Institute of Data Science of Technologies scored 82.44, edging past the 82.304 that rival humans achieved.
Lego is partnering with Tencent to jointly develop online games and potentially a social network aimed at children in China.
Xiaomi has picked Citic Securities, Goldman Sachs, and Morgan Stanley as joint sponsors for its proposed IPO, which will most likely be in Hong Kong.
A new Starbucks opens in China every 15 hours.
Chinese carmaker may use Fiat Chrysler for a foothold in the United States: NYT reports, GAC Motor said it planned to bring an SUV to the United States in 2019. It may use Fiat Chrysler dealerships hungry for new models.
TRENDS
Half of Americans want to regulate social media news: Report shows the public is concerned about fake stories and political polarisation.
FT
CULTURE
WSJ: Is that a Frank Lloyd Wright? Prove it: A home designed by a famous architect can command a premium, but in today’s competitive housing market, more buyers are turning to scholars to make sure claims are legitimate. https://goo.gl/F1YWuV
SPORT
Olympic gymnast Biles Alleges sexual abuse by team doctor: WSJ reports, gymnast Simone Biles, the star of the 2016 Olympic Games and the face of her sport in the United States, said she was among the elite gymnasts sexually abused by the longtime US team physician Larry Nassar.
AFP: Cool Runnings' revisited as Jamaican women qualify in bobsled
NFL Las Vegas odds:
Jacksonville v New England -9
Minnesota -3.5 v Philadelphia
