Following ‘Fire and Fury,’ Trump Looks to Ease Tensions in Asia


“The theft of intellectual property by foreign countries costs our nation millions of jobs, and billions and billions of dollars,” Mr. Trump said, flanked by corporate executives. “For too long, this wealth has been drained from our country while Washington has done nothing.”

“They have never done anything about it,” he declared. “But Washington will turn a blind eye no longer.”

Mr. Trump pledged to defend American companies from counterfeiting and piracy. But the document he signed in the Oval Office only authorizes the United States Trade Representative to consider whether to begin an investigation.

That all but guarantees that the United States will not take any action against China, at least until after Mr. Trump meets President Xi Jinping in Beijing this fall. Mr. Trump, a senior official said, warned Mr. Xi of the impending trade action in a phone call late on Friday that was largely devoted to cooperating on the North Korea threat.

So far, Mr. Xi has fallen short of Mr. Trump’s hopes as a partner in pressuring the North Korean regime to curb its nuclear and missile programs. But senior officials said the White House still views China as the key player in curbing Kim Jong-un, the North Korean dictator.

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Gen. Joseph F. Dunford Jr. met with President Moon Jae-in of South Korea on Monday.

Credit
Bae Jae-Man/Yonhap, via Associated Press

The White House had deferred the announcement of the trade investigation until this week to secure China’s support for additional sanctions against North Korea at the United Nations Security Council earlier this month. It was only the latest example of Mr. Trump pulling back on the trade front to encourage a more constructive Chinese role on North Korea.

Chinese officials have historically tried to link disparate issues, like North Korea and American arms sales to Taiwan. On Monday, before Mr. Trump’s announcement, the official China Daily newspaper warned that his investigation would poison relations between the two countries.

“Given Trump’s transactional approach to foreign affairs,” the paper said, “it is impossible to look at the matter without taking into account his increasing disappointment at what he deems as China’s failure to bring into line the Democratic People’s Republic of Korea.”

Far from giving him leverage, however, experts said Mr. Trump’s linkage of trade and security was binding his hands.

“It implies that China’s action on North Korea is a gift to the United States, and not that these actions are in China’s own interests,” said Evan S. Medeiros, a former top China adviser to President Barack Obama. “It is a wrong assumption, and it plays into China’s own strategy.”

On the diplomatic front, administration officials fanned out in an attempt to lower the temperature following Mr. Trump’s remarks last week.

“The United States military’s priority is to support our government’s efforts to achieve the denuclearization of the Korean Peninsula through diplomatic and economic pressure,” General Dunford was quoted as saying in a statement released by Mr. Moon’s office.

He was echoing a point made by Mr. Mattis and Mr. Tillerson in an opinion column posted Sunday by The Wall Street Journal. “The U.S. has no interest in regime change or accelerated reunification of Korea,” they wrote. “We have no desire to inflict harm on the long-suffering North Korean people, who are distinct from the hostile regime in Pyongyang.”

On Monday, Mr. Mattis sent a message of deterrence. When asked about North Korea’s threat to fire ballistic missiles into the waters off Guam, an American territory in the Pacific, he said, “If they fire at the United States, it could escalate into war very quickly.”

Mr. Kim has been told that his military is ready to launch ballistic missiles toward Guam, but he said he would wait before telling them to proceed, the North’s state-run news media reported on Tuesday.

General Dunford’s visit to South Korea was the first of three stops in his trip to the region, which has been roiled by the exchange of threats between Mr. Trump and Mr. Kim. General Dunford arrived in China on Monday night, and will travel to Japan later in the week.

For months, White House officials have debated how harshly to strike China on trade issues. After threatening during the campaign to label China a currency manipulator, Mr. Trump decided to forego that step as he cultivated a personal relationship with Mr. Xi.

In April, the president ordered an investigation into the world steel market. White House officials said that inquiry was aimed squarely at China, which they accused of dumping excess steel in other countries that finds its way into the United States, and undercuts domestic producers.

But that effort has bogged down amid resistance from allies, who ship far more steel to the United States than China; domestic manufacturers, who worry about their supplies of steel; and the Defense Department, which objected to the White House’s decision to invoke national security as a criteria for propping up the domestic steel industry.

The administration’s decision to pivot from steel to intellectual property puts it on firmer legal ground. Few experts dispute that China has stolen or forced American companies to turn over technology at an estimated cost of $600 billion.

Yet Mr. Trump’s modulated tone seemed calculated to open a negotiation with China rather than ignite a trade war.

“The big issue is, what does Trump do? After you find that China has acted unreasonably, what is the remedy?” said Gary Clyde Hufbauer, a trade expert at the Peterson Institute for International Economics.

If the United States pursued China through the World Trade Organization, the case could stretch out through the remainder of the Trump administration. Mr. Trump could impose tariffs, but Mr. Hufbauer said, “You can be sure that the Chinese will retaliate.”

Another question is whether the White House will seek allies. Japanese and European companies are both victims of theft, and trade experts said a united front would strengthen Mr. Trump’s case.

Some senior officials said Mr. Trump’s decision to lead with an intellectual property case after weeks of talking about steel amounted to a “head fake” on the Chinese. But while Mr. Trump is delivering on one of his core campaign promises, the protection of intellectual property is not an issue that particularly animates his political base.

Still, said Daniel M. Price, a trade adviser to President George W. Bush who is now at Rock Creek Global Advisors, “The administration has sensed correctly that the mood in the U.S. business community has changed. Frustration with Chinese practices has risen to the point that they are willing to support strong enforcement action.”

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