Latest news with #ScottKennedy
Business Mayor
21-05-2025
- Business
- Business Mayor
CNBC's The China Connection newsletter: A fragile truce as tempers flare
Containers pile up at Taicang Port Container Terminal in Suzhou City, Jiangsu Province, China, on May 18, 2025. Nurphoto | Nurphoto | Getty Images This report is from this week's CNBC's The China Connection newsletter, which brings you insights and analysis on what's driving the world's second-largest economy. Each week, we'll explore the biggest business stories in China, give a lowdown on market moves and help you set up for the week ahead. Like what you see? You can subscribe here. The big story Just a week after a breakthrough in U.S.-China trade tensions, neither side can yet be confident that the other is holding up their end of the bargain. 'These 90 days won't be smooth,' Liu Weidong, research fellow at a state-affiliated think tank, the Chinese Academy of Social Sciences' Institute of American Studies, told me this week. That's according to a CNBC translation of his Mandarin-language remarks. He predicts elevated uncertainty and smaller steps next, given the already-large breakthrough, as the U.S. and China each try to feel the other out towards a middle ground. The posturing has already begun. China's Ministry of Commerce on Wednesday warned that it would take legal action against those involved in assisting or implementing measures to curb the usage of advanced semiconductors from China. It follows an earlier accusation by the same ministry on Monday that blamed the U.S. for undermining trade talks with a Huawei chip warning last week — although the U.S. Bureau of Industry and Security had actually toned down its language and dismissed a more restrictive Biden-era plan on chips. Many in the U.S. are also concerned that China isn't relaxing rare earth export controls, another area in which China dominates the supply chain. That's despite the joint statement's vague description of how China would 'suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025.' Read More Aid Is Rushing Into Gaza While the Cease-Fire Holds 'I do think Washington was expecting the export controls on that group of rare earths to be lowered, permitting exports in a relatively unrestricted way,' said Scott Kennedy, senior adviser and trustee chair in Chinese Business and Economics at the Center for Strategic and International Studies in Washington, D.C. 'If it turns out that, in fact, that is not the result, the U.S. will probably conclude that China is in violation of the agreement,' he said. 'We could see a re-escalation sooner rather than later.' While the White House has yet to respond to a CNBC request for comment, a step back reveals ambiguity on China's side. But are the rare earth export controls part of China's countermeasures to U.S. tariffs? That's up for debate. An April 4 document from China's commerce ministry and customs agency announcing the export controls did not explicitly label them as such. While China did pause restrictions on 28 U.S. entities that were slapped with export controls on critical minerals, the ministry has made several public statements about strengthening export controls on critical minerals. 'Given the comprehensive and competitive nature of bilateral relations, the current truce — while focused on trade—can easily be undermined by export controls,' said Yue Su principal economist, China, at The Economist Intelligence Unit. 'While rhetorical posturing is unlikely to undermine the 90-day truce, China may well recalibrate its export control regime in a measured response to U.S. actions,' she said. The Chinese commerce ministry on Sunday also announced duties of up to 74.9% on imports of an engineering plastic from the U.S., Europe, Japan and Taiwan. Trump-Xi talk? U.S. President Donald Trump last week told Fox News he is open to a call with Chinese President Xi Jinping, or even a trip to China. But Beijing hasn't dropped any hints. 'I'd be surprised if the two step into the middle of these issues right now with so much unclear,' Kennedy said. The new U.S. Ambassador to China, David Perdue, arrived in Beijing on Thursday, slightly more than two weeks after being confirmed by the Senate. He was previously the head of Asia for U.S. packaged consumer goods company Sara Lee. One of Perdue's first social media posts called for 'strong actions' on fentanyl. He said on X that, together with U.S. Trade Representative Jamieson Greer, they were 'meaningfully engaged with the Chinese on next steps to stop this dangerous situation.' The U.S. has left in place 20% in tariffs imposed earlier this year over China's alleged role in the fentanyl crisis. The joint statement last week said the U.S. and China would establish a mechanism for talks about economic and trade relations, but neither side has specified when the next one would occur. Liu, who helped author a report in February with The Carter Center about bilateral cooperation, emphasized the overall focus of the current talks is trade rather than tech. He expects that China could eventually agree to buy more U.S. agriculture and energy products — given the perception that pressuring farmers can influence Trump. Top TV picks on CNBC Qualcomm CEO Cristiano Amon on tariffs and China Cristiano Amon, CEO of Qualcomm, discusses tariffs and the China market for his business. Toyota North America COO on new fleet of cars and tariffs on auto imports Mark Templin, Toyota North America COO, joins CNBC's 'Closing Bell' to discuss the company's launch of their new products, the company's pricing, and much more. Walter Isaacson on biotech breakthroughs vs. federal funding cuts, Trump-U.S. business relationship Walter Isaacson, 'Elon Musk' author, Perella Weinberg Partners advisory partner and Tulane professor, joins 'Squawk Box' to discuss breakthroughs in gene editing and biotech to cure diseases, impact of federal funding cuts, the White House relationship with the business world, and more. Need to know In the markets Stock chart icon The performance of the Shanghai Composite over the past year. Chinese and Hong Kong stocks climbed Wednesday. Mainland China's CSI 300 was up 0.68% while Hong Kong's Hang Seng Index — which includes major Chinese companies — rose 0.53% as of 12 p.m. local time. The benchmark 10-year Chinese government bond yield is at 1.669%. Coming up May 22: Xiaomi to release mobile phone chip, its first SUV and other products May 27: China to report industrial profits for April
CNBC
21-05-2025
- Business
- CNBC
CNBC's The China Connection newsletter: A fragile truce as tempers flare
Just a week after a breakthrough in U.S.-China trade tensions, neither side can yet be confident that the other is holding up their end of the bargain. "These 90 days won't be smooth," Liu Weidong, research fellow at a state-affiliated think tank, the Chinese Academy of Social Sciences' Institute of American Studies, told me this week. That's according to a CNBC translation of his Mandarin-language remarks. He predicts elevated uncertainty and smaller steps next, given the already-large breakthrough, as the U.S. and China each try to feel the other out towards a middle ground. The posturing has already begun. China's Ministry of Commerce on Wednesday warned that it would take legal action against those involved in assisting or implementing measures to curb the usage of advanced semiconductors from China. It follows an earlier accusation by the same ministry on Monday that blamed the U.S. for undermining trade talks with a Huawei chip warning last week — although the U.S. Bureau of Industry and Security had actually toned down its language and dismissed a more restrictive Biden-era plan on chips. Many in the U.S. are also concerned that China isn't relaxing rare earth export controls, another area in which China dominates the supply chain. That's despite the joint statement's vague description of how China would "suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025." "I do think Washington was expecting the export controls on that group of rare earths to be lowered, permitting exports in a relatively unrestricted way," said Scott Kennedy, senior adviser and trustee chair in Chinese Business and Economics at the Center for Strategic and International Studies in Washington, D.C. "If it turns out that, in fact, that is not the result, the U.S. will probably conclude that China is in violation of the agreement," he said. "We could see a re-escalation sooner rather than later." While the White House has yet to respond to a CNBC request for comment, a step back reveals ambiguity on China's side. But are the rare earth export controls part of China's countermeasures to U.S. tariffs? That's up for debate. An April 4 document from China's commerce ministry and customs agency announcing the export controls did not explicitly label them as such. While China did pause restrictions on 28 U.S. entities that were slapped with export controls on critical minerals, the ministry has made several public statements about strengthening export controls on critical minerals. "Given the comprehensive and competitive nature of bilateral relations, the current truce — while focused on trade—can easily be undermined by export controls," said Yue Su principal economist, China, at The Economist Intelligence Unit. "While rhetorical posturing is unlikely to undermine the 90-day truce, China may well recalibrate its export control regime in a measured response to U.S. actions," she said. The Chinese commerce ministry on Sunday also announced duties of up to 74.9% on imports of an engineering plastic from the U.S., Europe, Japan and Taiwan. U.S. President Donald Trump last week told Fox News he is open to a call with Chinese President Xi Jinping, or even a trip to China. But Beijing hasn't dropped any hints. "I'd be surprised if the two step into the middle of these issues right now with so much unclear," Kennedy said. The new U.S. Ambassador to China, David Perdue, arrived in Beijing on Thursday, slightly more than two weeks after being confirmed by the Senate. He was previously the head of Asia for U.S. packaged consumer goods company Sara Lee. One of Perdue's first social media posts called for "strong actions" on fentanyl. He said on X that, together with U.S. Trade Representative Jamieson Greer, they were "meaningfully engaged with the Chinese on next steps to stop this dangerous situation." The U.S. has left in place 20% in tariffs imposed earlier this year over China's alleged role in the fentanyl crisis. The joint statement last week said the U.S. and China would establish a mechanism for talks about economic and trade relations, but neither side has specified when the next one would occur. Liu, who helped author a report in February with The Carter Center about bilateral cooperation, emphasized the overall focus of the current talks is trade rather than tech. He expects that China could eventually agree to buy more U.S. agriculture and energy products — given the perception that pressuring farmers can influence Trump. Qualcomm CEO Cristiano Amon on tariffs and China Cristiano Amon, CEO of Qualcomm, discusses tariffs and the China market for his business. Toyota North America COO on new fleet of cars and tariffs on auto imports Mark Templin, Toyota North America COO, joins CNBC's "Closing Bell" to discuss the company's launch of their new products, the company's pricing, and much more. Walter Isaacson on biotech breakthroughs vs. federal funding cuts, Trump-U.S. business relationship Walter Isaacson, 'Elon Musk' author, Perella Weinberg Partners advisory partner and Tulane professor, joins "Squawk Box" to discuss breakthroughs in gene editing and biotech to cure diseases, impact of federal funding cuts, the White House relationship with the business world, and more. Chinese exporters are doubling down on non-U.S. markets. That's based on a poll by Allianz Trade. But a Shanghai-based baby products company on Tuesday announced a major ramp-up of its U.S. market expansion. Meanwhile, analysts and industry players point out how some Chinese exporters have found illicit ways around U.S. tariffs. Retail sales and industrial production growth slowed in April. The sluggish real estate sector showed little sign of improvement. However, major Chinese online shopping companies reported better sales in the first quarter, helped by artificial intelligence-powered ads. Electric car company Leapmotor said its gross margin for the first quarter was a record 14.9%, while Chinese battery giant CATL raised $4.6 billion in its Hong Kong listing on Tuesday. China is gearing up for its next five-year plan. The next set of development goals will kick in next year. The science ministry, central bank and several other ministries have also announced measures to support "high-level scientific and technological self-reliance." A new policy for preventing government spending waste calls for favoring domestic vehicles, especially new energy makes. Chinese and Hong Kong stocks climbed Wednesday. Mainland China's CSI 300 was up 0.68% while Hong Kong's Hang Seng Index — which includes major Chinese companies — rose 0.53% as of 12 p.m. local time. The benchmark 10-year Chinese government bond yield is at 1.669%. May 22: Xiaomi to release mobile phone chip, its first SUV and other products May 27: China to report industrial profits for April
CTV News
10-05-2025
- Business
- CTV News
Negotiating China-U.S. tariff agreement could take years, expert says
Watch Scott Kennedy, an expert in Chinese business and economics, estimates that the trade negotiations could 'take up to two years' to finalize.
South China Morning Post
27-04-2025
- Business
- South China Morning Post
Why Scott Kennedy thinks the US-China trade war is ‘far from the endgame'
Scott Kennedy is a senior adviser and trustee chair in Chinese business and economics at the Washington-based Center for Strategic and International Studies think tank. He has visited China on numerous occasions over the past 37 years and written extensively on the country, particularly regarding its economic policy and relations with the United States. Advertisement This interview first appeared in SCMP Plus . For other interviews in the Open Questions series, click here On April 2, US President Donald Trump ramped up the trade war by announcing a 'Liberation Day' package of tariffs . Their scale and magnitude shocked the world, as they were levied against rivals and allies alike. What is your take? The Trump administration has offered a variety of explanations for their approach to international trade and management of the global economy. The one that seems most persuasive to me is their view that the international trading system has been deeply unfair to the US for a long time. The US has maintained lower tariff and non-tariff barriers than those from other countries, whether allies or not. As a result of viewing the system as unfair, they believed that they could not use the World Trade Organization and other traditional means to get a better outcome. So instead, they decided to use the leverage of denying access to the American market to force through change. Advertisement We saw the dramatic results unfold on April 2 and in the days afterward, in their effort to switch from a multilateral system of common tariffs based on most favoured nation status and national treatment to one based on reciprocal tariffs negotiated line by line, country by country. This is not necessarily where they want things to end. Rather, they want to start negotiations that could result in tariffs potentially coming down if possible.
Yahoo
21-04-2025
- Business
- Yahoo
How China's 'monster market' could impact US Big Tech
China could make life harder for US Big Tech companies like Tesla (TSLA) and Apple (AAPL), but it lacks the direct leverage the US holds. Scott Kennedy, senior adviser and trustee chair in Chinese business and economics at the Center for Strategic and International Studies, explains how China might still push for a deal with the US. To watch more expert insights and analysis on the latest market action, check out more Catalysts here. But how much power does China have to really deign the US large cap tech names? Uh, China is a monster market for many uh American companies. Um, and they can uh impose a lot of pain if they choose to. I don't think they want to. They want those companies' investments and partnerships in China and in third markets. Uh, but um if they decided to, uh they could make life much more difficult for Tesla in China, for Apple, uh for some other companies. Uh, they've already launched investigations into Google, uh into DuPont. Um, yet China doesn't have the direct level of leverage that the US does, but it can impose pain. I think the main way the Chinese can hurt the US is by fighting back in general, uh looking like they have staying power, which makes American financial markets uh less stable. Uh, and we've seen that over the past few weeks. I think that's their main strategy to try to get the US to want to get to a deal. Sign in to access your portfolio
