China Releases 3 Americans; How Trump's Tariffs Could Impact Chinese Exports | China in Focus

Welcome to China In Focus. I'm Tiffany Meyer. Our top story. Three Americans are finally heading home after years in Chinese custody. The U.S. reportedly brokered a high-stakes prisoner swap, securing their release after being wrongfully detained in China. President-elect Donald Trump naming a veteran from his first term as the new U.S. trade representative, tasking him with leading the next tariff agenda. Some Chinese exporters have been looking for alternatives to the U.S. market. How Trump's tariffs could accelerate the trend. And the U.S. sending its latest nuclear-powered submarine to Guam, a military base closer to China than to Hawaii. What the Navy says propelled the move. Before we dive into today's top story, a quick announcement. China In Focus will pause this Thursday for Thanksgiving. As the holiday season approaches, we'd like to thank you for tuning in over the past year. We look forward to bringing you even more fast, compelling, first-hand news from China and around the world as we enter 2025. With that, from our NTD family to yours, we wish you a warm and safe holiday season. An alleged prisoner swap between Washington and Beijing. China released three Americans on Wednesday that have been in custody for years. The White House says soon they will return and be reunited with their families for the first time in many years. The released Americans are Mark Swidin, Kai Li and John Leung. The U.S. said Li and Swidin were wrongfully detained in China. It's unclear who would be sent back to China in exchange for their freedom. NTD reached out to the State Department. The agency replied but didn't give details. Mark Swidin is a businessman from Texas. A Chinese court upheld his death sentence with a two-year reprieve. Swidin was first arrested on drug-related charges. His mother said she was worried her son might not make it home alive. As for John Leung, China sentenced him to life in prison this May. The charge was but Chinese authorities did not give details. He's a 78-year-old U.S. citizen. China also confiscated about $70,000 worth of his personal property. Kai Li was detained during a 2016 visit to see relatives in Shanghai. China accused him of providing Chinese state secrets to the FBI. He had been serving a 10-year prison sentence at the time of his release. Senate Majority Leader Chuck Schumer had been working with Li's son to secure his release. In a statement, Schumer said for the families of the freed Americans, this Thanksgiving, there is so much to be thankful for. The Biden administration has been working to secure their release. President Biden raised the issue with Chinese leader Xi Jinping earlier this month in Peru. Also on Wednesday, the U.S. lowered its travel advisory level for China from reconsidered travel to exercise increased caution. According to a rights group's estimates, there are 200 U.S. citizens still detained in China or who are being prevented from leaving more than any other foreign nation. Turning to economic policy, Trump tapped trade attorney Jameson Greer as his new U.S. trade representative. Greer played a key role in Trump's first term implementing tariffs on China and renegotiating the U.S.-Mexico-Canada trade agreement. Here's more. U.S. President-elect Donald Trump tapped trade lawyer Jameson Greer as his new trade representative Tuesday. It comes a day after Trump's threats of hefty tariffs on Canada, Mexico and China, as he urged them to step up efforts to curb the drug trade, especially regarding fentanyl and illegal immigration. Greer was a veteran of Trump's first-term trade war against China. Back then, he served as chief of staff to former trade representative Robert Lighthizer. His views on China are also firmly aligned with Trump, saying there is a need to counter China's efforts to dominate global industries. Testifying before the U.S.-China Economic and Security Review Commission in May, he argued in favor of increased tariffs and advocated for stronger export controls on sensitive U.S. technologies. Trump's rhetoric has prompted China to warn that no one can win a trade war. It has also drawn a rebuke from Mexico. Country President Claudia Sheinbaum said her government could retaliate with tariffs of its own, with severe economic consequences for both sides. Meanwhile, Mexican border towns are already feeling the strain from Trump's plans. Jesus Manuel Sallandia, coordinator of the Border Business Block, said border cities have been losing a lot of competitiveness, and many industries have been feeling uncertain about the future. We are going to see how things will progress once the president-elect takes office on January 20. But the messages they have been sending, saying they want to raise tariffs, calling the border conflictive, talking of issues like violence and migration, they are not contributing to all of the investments that could come. Others take a more nuanced view, suggesting Trump's threats may be more of a negotiating tactic. Mario Cepeda is president of the Mexican Employers' Confederation in the border town of Childat Juarez. He says Trump is starting to negotiate better conditions for his country and looking after his own interests. Cepeda says Mexico should do the same. Some Chinese exporters have been cutting reliance on the U.S. market. Others are moving production to Southeast Asia to evade existing U.S. tariffs. This trend could accelerate if president-elect Trump follows through on his terror threats on China. On Monday, Trump said he would impose an extra 10 percent tariff on Chinese goods and 25 percent on those from Canada and Mexico. Prior to this, Trump said he would slap a 60 percent tariff on goods from China. A business owner in China who exports to the U.S. said her sales are down, adding American customers have been putting pressure on prices for the past five years. The Middle East has become a better market for her. Chinese exports are said to hit a record high this year, though its U.S.-bound exports have dipped from 19 percent in 2018 to 15 percent last year. If Trump makes good on his promise, light manufacturing and textiles are among the industries expected to get hit the hardest, along with steel and computers. That's according to a report by a Chinese brokerage. JPMorgan predicts that China could allow its currency to lose value by up to 15 percent if a trade war hits. A bombshell dropping in some of the world's most important trade relations, Trump vows to impose new tariffs on Mexico, Canada and China as soon as he takes office. Canadian Prime Minister Justin Trudeau says he spoke to Trump after the announcement. I had a good call with Donald Trump last night again. We obviously talked about laying out the facts, talking about how the intense and effective connections between our two countries flow back and forth. I reached out immediately to Doug Ford to agree with him that we would have a First Minister's meeting this week to talk about the United States, talk with François Legault and some other premiers as well. Doug Ford is the Premier of Ontario and François Legault is the Premier of Quebec. Both leaders strongly oppose Trump's tariff proposal. Trudeau held a virtual meeting with the premiers Wednesday evening to discuss a counterweight plan. Another Canadian lawmaker urged Ottawa to diversify its trading partnership to reduce its reliance on the U.S. And Canada is absolutely committed to working with our American neighbours to ensure that their northern border is fully secure. At the same time, China argued that fentanyl is a U.S. problem, adding that it has already made an effort to help the U.S. solve the issue. In response to Trump's high tariff warning, Beijing's foreign ministry said no one will benefit from a trade war. Mexico also protested, saying the tariff would hurt companies on both sides of the border and could worsen U.S. inflation. Shifting to foreign policy, some critics say Trump's America First approach could hurt allies like Taiwan. And on national security, there are growing concerns about the Chinese hacking group Salt Typhoon, which has breached major U.S. networks and even stole sensitive government data. To discuss, we sat down with John Mills, retired Army Colonel and former Director of Cybersecurity at the Defense Department. The America First approach values strategic partners, but they have to carry their fair share of the responsibilities. And I think Taiwan is doing very good. I think it's 2.6% of GDP they're at on a pathway very shortly to 3.5% of GDP. Our deliveries are actually lagging behind their spend on military equipment. So I don't, some people have been floating that and saying, oh, President-elect Trump is going to, you know, is going to hand Taiwan over to China. No, that's not going to happen. And it's just carrying your fair share is the big issue. And I think Taiwan is doing very well and can demonstrate that very clearly. And all of the experts such as Mike Waltz, they know what's really going on. In terms of national security, multiple reports are noting the threat of Chinese hacking group Salt Typhoon, which is lurking in our cell phone networks like Verizon, AT&T and T-Mobile. It's even getting access to government wiretapping requests from the FBI and DOJ. Now, as the former Director of Cybersecurity at the Defense Department, what is your advice on stopping and countering Salt Typhoon? Well, one of the best ways to hold China accountable is hit them in the financial sector. If they hit us in cyber, that doesn't mean the best response is in cyber. It means they found vulnerabilities, but to stop them, you hit them where it hurts and it's usually the financial sector. So you cut them off from venue after venue, you will get their attention. So this goes back to Volt Typhoon from early 2023, and it's continuing on through different sectors. This is one of the biggest aspects of cyber that many of the cyber experts don't get, don't understand. You must always use all instruments of national power. And if they're going to hit you where they find vulnerabilities in our IT networks, fine. We hit them twice as hard in another sector where it's going to get their attention. That's how you get them to stop first and foremost. John Mills, thank you so much for your time. Tiffany, thank you. Always an honor to be on the show. The U.S. on Tuesday deploying its latest nuclear-powered fast attack submarine to Guam, a military base closer to China than to Hawaii. Because of its location, Guam is known as the tip of the spear of the U.S. military might. It's critical for U.S. power projection in the Indo-Pacific region. The U.S. Navy said the move is part of a strategic plan for naval forces in the Indo-Pacific, adding the security environment there calls for the most capable units. Washington has committed about $11 billion to revamp infrastructure on Guam. Coming up, Taiwanese prosecutors charged five nationals for profiting from Oregon tourism to China. One of those charged is a surgeon. The surgeon took advantage of medical consultations, learned about patients' needs for liver or kidney transplants. Then he subsequently arranged for patients and their families to travel to mainland China. Ministers from G7 member nations meeting to discuss rising Chinese aggression in the Taiwan Strait and the South China Sea. Details on Japan's stance. And Volkswagen is getting out of China's Xinjiang region. The company has faced pressure to leave for years due to allegations of human rights abuses in the area. More on that after the break. Here on China In Focus. Welcome back to China In Focus. I'm Tiffany Meyer. Taiwan is clamping down on illegal Oregon deals. Earlier this week, a Taiwanese surgeon and four other individuals were charged with violating the island's Oregon transplant law. That's by profiting from deals in China. Local media say the case is alarming because Beijing is known to source organs from prisoners of conscience. The surgeon took advantage of medical consultations, learned about patients' needs for liver or kidney transplants. Then he subsequently arranged for patients and their families to travel to mainland China. The Taiwanese surgeon's name is Chen Yaoli. He and four other Taiwanese citizens were accused of organizing trips to China for Oregon transplant tours looking for surgery. According to the indictment, they sent 10 Taiwanese patients to receive organs in China from 2016 to 2019. They reportedly made huge profits. According to prosecutors, most of the transplant recipients only survived for two or three years after their surgeries. Some even passed away a few days after returning to Taiwan. Prosecutors call the clandestine Taiwanese law prohibits the selling, buying and brokering of organs and transplant tourism. Chen allegedly earned over $455,000 from these transplant deals. In total, his group is accused of making nearly $630,000 in profits. If convicted, Chen could face up to five years in prison. Chinese authorities are accused of forcefully harvesting organs from prisoners of conscience. Followers of faith group Falun Gong and other ethnic minorities are considered some of the primary targets. Here in the U.S., the House passed a bill called the Falun Gong Protection Act in June. It's now waiting on a Senate vote. If approved, the law could give the U.S. government rights to sanction Chinese officials and anyone else involved in forced organ harvesting. The economy has been a top issue this election cycle. While the stock market broke multiple record highs under Biden, consumers have still felt the pressure of inflation. Trump has said he plans to stem inflation by increasing domestic energy production and reining in government spending and regulations. NTD's Chris Beers sat down with Daniel Lacalle, chief economist at Spanish Bank Atreces, to talk about how those policies could impact your bottom line. Well, we need to remember that tariffs are not inflationary. And we have seen in the past, in the history of money, shows us that tariffs themselves don't cause inflation. What causes inflation is the increase in government spending. China can certainly adopt those tariffs without increasing prices for consumers because they need the United States trade surplus in order to continue to maintain a certain level of inflow of U.S. dollars in the economy. So the Chinese element is likely to happen because China itself is one of the countries that implements the biggest barriers to trade in the world. Therefore, the problem is not the United States tariffs, but the Chinese barriers to trade. The rest of the tariffs that Trump is announcing are mostly negotiation tariffs that the Trump administration is willing to negotiate with trading partners in order to improve the trading activity of United States companies abroad. So I think that that's the way to look at them. On the one side, some tariffs will be negotiated in order to improve the trade balance of the United States, and others, particularly to China, will be there. But I don't think that they're going to imply an increase in aggregate prices, which is what CPI inflation measures. Interesting. Thank you for getting into the nuances of that and clarifying things for us. Now, the next president has floated the idea of straight up abolishing income tax. How could he supplement the income, the revenue from that, with other measures? Well, obviously, it's very difficult to directly eliminate income tax. The income tax revenue is one of the not just the strongest revenues in the budget, but the one that is probably more stable than others. The income tax in the United States could be easily reduced significantly by being a little bit more creative with the brackets, simplifying the brackets, making them more attractive, more focused on what the reality of the US economy is, and therefore reducing it for the middle class and reducing it for the segments that apply to professionals in particular, etc. So that the income tax would be significantly lower, but without any impact on revenues. The element that needs to be taken into account to reduce the deficit and cut debt is to reduce expenditure, which was not the case in the first administration of Mr. Trump. So in this occasion, government efficiency measures are going to be a key element to maintain or to at least strengthen the financial situation of public accounts. And those measures are, of course, the focus of the new Department of Government Efficiency that will be headed by Elon Musk and Vivek Ramaswamy. It should be very interesting to watch over the next four years. Daniel Akaiye, thank you so much for your time. Thank you very much. Pleasure. Japan on Tuesday stressed issues in the Taiwan Strait needed to be solved peacefully. That's as foreign ministers from G7 member nations met with officials from the Indo-Pacific in Italy. Take a listen. The G7 comprises Britain, Canada, France, Germany, Italy, Japan, and the United States plus the European Union. The Chinese Communist Party sees Taiwan as part of China despite never having ruled it. It has pledged to take the island under control by force if necessary. Ministers also discussed growing tension in the South China Sea. Chinese Coast Guard vessels have rammed into Filipino boats and sprayed water canyons at them. Both China and the Philippines claim the South China Sea, though Beijing claims almost all of it. An international court has ruled China's claim invalid. The Philippines president signed two laws reaffirming his country's claims in the South China Sea. China summoned the Philippines ambassador to China to launch a protest. Japan's foreign ministry said it supports the Philippines' move, adding it's concerned about Chinese vessels' behavior toward Filipino boats. Volkswagen said Wednesday it's selling off all of its businesses in China's Xinjiang region. The move follows years of mounting pressure to abandon its presence there. Human rights groups have documented abuses against the Uyghur population in the region. Here are the details. The carmaker made the announcement while also saying it would extend its partnership with Chinese firm SAIC by a decade to 2040. The Xinjiang plant opened in 2013 and previously assembled Volkswagen's Santana vehicle. It dwindled in significance in recent years after the carmaker cut jobs. The facility had the capability to manufacture 50,000 units annually but had not produced any cars since 2019. Volkswagen denies reports that it kept the plant open as a condition from Beijing to keep producing across China. That's all for today's China In Focus. I'm Tiffany Meyer. If you have any feedback on the show or have something you'd like to see us cover, send us an email at chinainfocus and td.com. We'd love to hear from you. For around the clock original news coverage, visit us at ntd.com or download our NTD app. Thanks for watching. See you soon. Coming up on NTD, stay tuned for America's Hope with Kelly Wright. Tonight, after a tough, divisive and historic presidential election, Kelly Wright focuses on how Americans are seeking to become more united. Political analyst Christina Tobin discusses the impact of elections, while presidential historian Jane Hampton Cook offers a history-based look at this year's vote. Plus, she chronicles the history of Thanksgiving. That's tonight at 10 p.m. after China In Focus. Thanks for watching. See you soon.