BEIJING (Reuters) – China on Friday accused US officials of lying to the public about their trade war, as rising tensions between the world’s two largest economies kept financial markets in a state of unease.
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Talks to end the trade dispute collapsed earlier this month, with the two sides in a stalemate over US demands that China change its policies to address a number of key US grievances, including theft of intellectual property and subsidies for state enterprises.
Washington has slapped higher tariffs on $200 billion in Chinese goods, prompting Beijing to retaliate, and effectively banned US firms from doing business with Huawei Technologies Co Ltd, the world’s largest telecom network gear maker.
“Domestically in the United States there are more and more doubts about the trade war the US side has provoked with China, the market turmoil caused by the technology war and blocked industrial cooperation,” Chinese Foreign Ministry spokesman Lu Kang said.
US officials “fabricate lies to try to mislead the American people, and now they are trying to incite ideological opposition,” he said, when asked about US Secretary of State Mike Pompeo’s recent criticism of Huawei.
In an interview with CNBC on Thursday, Mr Pompeo said Huawei was connected to the Chinese government, dismissing Huawei chief executive Ren Zhengfei’s assertions that his company would never share user secrets.
“The company is deeply tied not only to China but to the Chinese Communist Party. And that connectivity, the existence of those connections puts American information that crosses those networks at risk,” Mr Pompeo said.
Huawei has repeatedly denied it is controlled by the Chinese government, military or intelligence services.
Mr Pompeo said he believed more American companies would cut ties with the tech giant, while the United States has been rallying its allies to persuade them not to use Huawei for their 5G networks.
US President Donald Trump said on Thursday that US complaints against Huawei might be resolved within the framework of a US-China trade deal, while at the same time calling the Chinese company “very dangerous.”
Mr Lu said he did not know what Mr Trump was talking about.
“Frankly, I’m actually not sure what the specific meaning of the US leader, the US side, saying this is,” he said.
World equity markets rebounded on Friday from heavy selling in the previous day’s session. The US dollar was trading lower against a basket of currencies and prices of safe-haven US government debt fell.