President Xi Jinping renewed a pledge Tuesday to open China’s markets further for trade and investment, including its automobile sector, and said he would also work harder to boost imports, in what was seen as a conciliatory speech amid an escalating trade conflict with the United States.

Speaking at an annual economic forum 40 years after China began what is known as the “reform and opening up” of its economy, Xi pledged to begin a new phase of that process. The Trump administration has threatened to impose tariffs on $150 billion in Chinese imports over allegations of unfair trade practices.

But his speech was more a reiteration of existing commitments than any major new initiatives, and experts said it was neither concrete enough in itself, nor far-reaching enough, to defuse the trade dispute with Washington — especially after years of broken promises.

Addressing several concerns raised by the U.S. administration and business community, Xi promised significantly lower import tariffs for vehicles, an easing of restrictions on foreign investment in autos and financial services, and greater protection for intellectual property.

Only a few hours before, President Trump had tweeted about China’s unfair 25 percent tariffs on car imports.Speaking at the Boao Economic Forum on the southern Chinese island of Hainan, Xi pledged to “significantly broaden market access” for foreign companies, including a pledge to ease foreign equity restrictions in the automobile industry “as soon as possible” and “significantly lower import tariffs” for vehicles.

“China does not seek a trade surplus,” Xi said. “We have a genuine desire to increase imports and achieve greater balance of international payments under the current account.”

Jake Parker at the U.S. China Business Council said Xi addressed some key concerns but fell short of offering “paradigm-shifting announcements” on ending the joint venture and licensing requirements that give China leverage to force technology transfer in return for market access.

“Ultimately U.S. industry will be looking for implementation of long-stalled economic reforms,” he said. “Lack of action to date has greatly undermined the optimism of the U.S. business community.”

On Tuesday, Trump thanked Xi on Twitter for his “kind words on tariffs and automobile barriers” and “his enlightenment” on intellectual property and technology transfers. “We will make great progress together!” the president added.China made a similar promise to cut auto tariffs in November when Trump visited Beijing, and again at the World Economic Forum in Davos, Switzerland, in January.

U.S. officials have reacted with skepticism until now, saying it was time for action, not empty promises. Nevertheless, the fact that Xi made the commitment in a keynote speech at an important event, billed as China’s version of Davos, gave the promise more weight.

Alicia Garcia-Herrero, chief Asia Pacific economist at the Natixis investment banking firm in Hong Kong, said Xi’s pledges were insufficient to resolve the trade dispute. And Christopher Balding, an associate professor of business and economics at the HSBC Business School in Shenzhen, said Xi’s speech was largely a “re-rerun of previous speeches and previous commitments.”

“I suspect this is not going to go down as well with our friends in Washington as some people are hoping,” he said. Balding said it would be hard to find a way out of the mounting trade conflict that would not leave either Trump or Xi, “both men with very large egos,” feeling that he had backed down.

China has consistently promised to further open its markets since Xi took office but has largely failed to follow through on those promises. It has also ignored years of entreaties from the U.S. administration and business community to level the playing field for foreign companies and resolve problems through dialogue and negotiation.

While U.S. business leaders in China want to avoid a trade war, there is broad support for the idea that it is time to get tough with Beijing.

Xi has made it clear that his vision for a “socialist market economy” is one where the Communist Party and state remain firmly in control, while protecting and subsidizing key industries. That approach, a fundamental bone of contention with Washington, is not about to change, experts said.


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