Wallace: Ambassador Cui, welcome to Fox News Sunday.
Cui: Thank you.
Wallace: I want to start with Vice President Pence's tough comments about China last week. The vice president called out what he says is your economic aggression, what he called your emboldened military, and what he alleges are your efforts to interfere in the U.S. midterm election. Are the U.S. and China now engaged in a New Cold War?
Cui: Well, first of all, I have to say all these accusations are groundless. One of the fundamental principles in China's foreign policy is non- interference in the internal affairs of other countries. And we have been consistent in this position. We have a very good track record.
Wallace: You were part of a quite tough meeting with Secretary of State Pompeo in Beijing this week, in which top Chinese officials said they would take "all necessary measures" to safeguard your country. How far is China prepared to go in terms of standing up to the U.S.?
Cui: I think it is the legitimate right of every country to defend its national interest. And China is no exception. But the talks Secretary Pompeo had in Beijing were very good communication at such high level between the two sides. And it's very timely.
Wallace: Let's unpack some of this. And let's start with the allegation of election meddling. Vice president Pence says that China is specifically targeting tariffs to hurt Republican voters to try to turn them away from voting for Republican candidates and eventually from voting for president Trump in 2020. He says that you are putting propaganda mailers in U.S. newspapers. And this week the FBI Director said that China is now the number one, the greatest counterintelligence threat that the U.S. faces. Are you engaged in trying to meddling in the election in 2018, like the way the Russians did in 2016?
Cui: Let me make it clear. Whatever we are doing in terms of tariffs, it is just a response to the tariffs the U.S. side has imposed on us. So it's a response. If the U.S. side could remove all the tariffs, we will drop all the tariffs. So this is tariffs for tariffs. It's for nothing else.
Wallace: And what about the mailers that you put in U.S. newspapers? John Bolton, the national security adviser, says that there are a number of classified actions you are taking the meddling in the U.S. election.
Cui: You see Chinese media, they are just learning from American media, to use all these means to buy commercial pages from newspapers to make their views known, or to cover what is happening here. This is normal practice for all the media.
Wallace: I want to turn to trade and the trade war. Let's put up here the tariffs that have been imposed. As you point out, President Trump has imposed tariffs on 250 billion dollars of Chinese goods. Your country has responded with tariffs on 110 billion dollars of U.S. exports. Here is President Trump on the situation.
Wallace: Now, I know you say that the U.S. started it. But at this point, whoever started it, are the U.S. and China engaged in a trade war?
Cui: Well, we do not want to have any trade war with any other countries, including the United States. But the fact is, through the bilateral trade between China and the United States, you know how much benefit American consumers have got over the years and how much money American companies have made from their operation in China? You have to look at the whole picture.
Wallace: So how do you explain what does seem to be a trade war now? I mean, regardless of who started it, they've imposed.
Cui: It is important to notice who started this trade war. We never want to have a trade war. But if somebody started a trade war against us, we have to respond and defend our own interests.
Wallace: And do you believe that the trade war and concerns of what that's gonna do to the global economy are contributing to the sharp drop in the stock market this week?
Cui: You see, China and the United States, we are the two largest economy in the world, we have the responsibility to make sure that we have a positive and constructive bilateral relationship. That will enhance people's confidence in the prospects of the global economy. This is our shared responsibility.
Wallace: And in a time like now when you don't have a positive experience and relationship in terms of the global economy?
Cui: Well, It's very unfortunate that a trade war was started, but it's not our fault. What we are doing is only response.
Wallace: The U.S. officials say, though, that China is not so innocent at all of this. They say that you steal intellectual property, that you force technology transfers from U.S. companies that invest in China to Chinese companies. And here is Trump's trade adviser Peter Navarro talking about China.
Cui: I think all these accusations about how China has developed are groundless and not fair to the Chinese people. You see China has 1.4 billion people. It would be hard to imagine that one fifth of the global population could develop and prosper, not by relying mainly on their own efforts, but by stealing or forcing some transfer of technology from others. That's impossible. The Chinese people are as hard-working and diligent as anybody on earth.
Wallace: Are you clear who President Trump listens to on trade issues, whether it's moderates like Kudlow or Mnuchin, or hardliners like Navarro?
Cui: You tell me.
Wallace: You have confusion about this? I mean, that's obviously part of your job, as the Chinese Ambassador, to be able to report back to Beijing who has the President's ear?
Cui: Honestly, I've been talking to Ambassadors of other countries in Washington, D.C.. This is also part of their problem.
Cui: They don't know who is the final decision-maker. Of course, presumably, the President will take the final decision. But who is playing what role? Sometimes it could be very confusing.
Wallace: There are also military tensions. A Chinese worship recently harassed, and here's a picture of it, very close, as you can see, a U.S. ship exercising freedom of navigation in the South China Sea. And the U.S. is close to approving a 330 million dollar arms sale to Taiwan. Do you view these,the U.S. ships in the South China Sea (and) sales to Taiwan, do you view those as U.S. provocations?
Cui: First of all, I think we have to be clear where the incident took place. You're right to say it was in South China Sea. So it's at China's doorstep. It's not Chinese warships that are going to the coast of California or to the Gulf of Mexico. It's so close to the Chinese islands and so close to the Chinese coast. So who is on the offensive? Who is on the defensive? This is very clear. About American arms sale to Taiwan,this is a very good example of American intervention into Chinese internal affairs.
Wallace: There is a popular book, I'm sure you're familiar with it, called the Hundred Year Marathon, which says that China has a secret strategy to, in effect, supersede, replace the United States as the world's great superpower by 2049, which would be the one hundredth anniversary of the forming of the People's Republic. Does China entertain ambitions to replace the U.S. as the world's great superpower?
Cui: For China, our only goal is for people to have a better life. We don't want to challenge or replace anybody else in the world. We want to build a community of nations for shared future together with all the rest of the world, including the US. As for the book you mentioned, I think there are many good books written by many good Americans here about China and about our relations. But since time is precious for everybody, I would not recommend you to read this particular book.
Wallace: It's fake news?
Cui: Well, you could come to your own conclusion. There are much better books.
Wallace: Ok, let's talk about another flashpoint-North Korea. Does China agree with North Korean leader Kim Jong-un that any steps that he takes towards denuclearization must be matched by U.S. concessions on the other side? And how do you respond to allegations even by President Trump that China has relaxed its sanctions against North Korea as allowing goods to flow into North Korea?
Cui: China has voted in favor of all the UN Security Council resolutions about sanctions against DPRK and we are implementing all these resolutions.
Wallace: You have not relaxed them?
Cui: As long as these resolutions are still in force, we will implement them faithfully. But at the same time, I think China and the United States, we do have a shared goal, which is denuclearization of the Korean Peninsula. And we both want to have lasting peace on the Korean Peninsula. That's why we welcome and support the summit in Singapore between President Trump and Mr. Kim. And we very much look forward to their second meeting. We hope concrete steps could be taken to have further progress toward these goals.
Wallace: And do you think that the United States is right that denuclearization has to happen first? Or do you agree with Kim that, North Korea takes a step, the U.S. takes a step?
Cui: I think in order to achieve the goals, we have to have coordinated, phased and step-by-step approach.
Wallace: That's the Kim's position.
Cui: Well, this is a reality. How can you convince him to give up all the nuclear weapons without any hope that the U.S. would be following a more friendly policy towards him？
Wallace: Finally, President Xi and President Trump will meet in Buenos Aires at the G20 Summit next month in November. What do you think are the possibilities that they can turn the situation around, make it less tense? And how important is it to President Xi in that meeting to not be seen as giving in to President Trump and not to be seen as losing face?
Cui: You see, I was very honored to be present at the meetings between the two Presidents, both at Mar-a-Lago April last year and in Beijing last November. And it was so clear that such top level communication plays the key role, irreplaceable role in guiding the relationship forward. And there's a good mutual understanding and good working relationship between the two, I hope and I'm sure this will continue.
Wallace: Ambassador Cui. Thank you so much. Please come back, sir.
Cui: Thank you！