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Handling of U.S. trade dispute causes rift in Chinese leadership

August 09
10:03 2018

A growing trade war with the United States is causing rifts within China’sCommunist Party, with some critics saying that an overly nationalistic Chinese stance may have hardened the U.S. position, according to four sources close to the government.

President Xi Jinping still has a firm grip on power, but an unusual surge of criticism about economic policy and how the government has handled the trade war has revealed rare cracks in the ruling Communist Party.

A prominent and influential academic whose views have found favour in some party quarters has also come under attack for his strident views on Chinese power.

Wang, who was the architect of the “China Dream”, Xi’s vision for China to become a strong and prosperous nation, has been taken to task by the Chinese leader for crafting an excessively nationalistic image for the country, which has only provoked the United States, the sources said.

“He’s in trouble for mishandling the propaganda and hyping up China too much,” said one of the sources, who has ties to China’s leadership and propaganda system.

The office of the party’s spokesman did not respond to a request for comment on Wang and his relationship with Xi, or on whether China had erred in its messaging in the trade war.

There is a growing feeling within the Chinese government that the outlook for China has “become grim”, according to a government policy advisor, following the deterioration in relations between China and the United States over trade. The advisor requested anonymity.

Those feelings are also shared by other influential voices.

“Many economists and intellectuals are upset about China’s trade war policies,” an academic at a Chinese policy think tank told Reuters, speaking on condition of anonymity due to the sensitivity of the issue. “The overarching view is that China’s current stance has been too hard-line and the leadership has clearly misjudged the situation.”

That view contrasts with the thinking at the beginning of the year of many Chinese academics who had touted China’s ability to withstand the trade row in the face of Trump’s perceived political weakness at home.

China thought it had reached a deal with Washington in May to avoid a trade war, but was shocked when the Trump administration, in Beijing’s eyes, went back on that agreement.

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