Photo, above: The oceanographic survey ship, USNS Bowditch, which deployed an underwater drone seized by a Chinese Navy warship in international waters in South China Sea, December 16, 2016. Courtesy U.S. Navy/Handout via REUTERS

Reminiscent of Iran freeing the American hostages on Ronald Reagan’s Inauguration Day in 1981, China has flinched in the controversy over the American underwater drone their Navy stole in international waters in the South China Sea, returning the drone one day after the US Electoral College confirmed Donald Trump’s election as President of the United States. It was returned near the spot where it was stolen last Thursday about 50 miles from Subic Bay, Philippine Islands.

Donald Trump has been very critical of China for its currency manipulation and promised a tough foreign trade stance.

Long before Trump was a presidential candidate I wrote an article on the US trade imbalance with China, and what we should do to fix it. Trump’s plan mirrors mine almost exactly. Link…. Time To Stop Being Stupid! China is a perfect example of a nation that can be coerced through threats of trade restrictions (tariffs). Without access to the American consumer market the Chinese are bankrupt in a hurry. Welcome to the Art of the Deal!

As reported by Reuters, China has returned a U.S. underwater drone taken by one of its naval vessels in the disputed South China Sea last week after what it said were friendly talks with the United States, which reiterated its criticism of the “unlawful” seizure.

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The taking of the unmanned underwater vehicle in international waters near the Philippines triggered a diplomatic protest and speculation about whether it would strengthen U.S. President-elect Donald Trump’s hand as he seeks a tougher line with China.

A Chinese naval ship took the drone, which the Pentagon says uses unclassified, commercially available technology to collect oceanographic data, on Thursday about 50 nautical miles northwest of Subic Bay in the Philippines.

China’s defense ministry said in a brief statement the drone had been given back to the United States on Tuesday.

“After friendly consultations between the Chinese and U.S. sides, the handover work for the U.S. underwater drone was smoothly completed in relevant waters in the South China Sea at midday,” the ministry said.

The defense ministry declined to give more details about the handover when contacted by Reuters.

The Pentagon said the vehicle had been handed over to the guided missile destroyer USS Mustin near where it had been “unlawfully seized”. It called on China to comply with international law and refrain from further efforts to impede lawful U.S. activities.

“The U.S. remains committed to upholding the accepted principles and norms of international law and freedom of navigation and overflight and will continue to fly, sail, and operate in the South China Sea wherever international law allows,” Pentagon Press Secretary Peter Cook said in a statement.

Chinese foreign ministry spokeswoman Hua Chunying referred questions about the handover and other details of the case to the defense ministry.

“The handling of this incident shows that the Chinese and U.S. militaries have quite smooth communication channels. We think that this communication channel is beneficial to timely communication and the handling of sudden incidents and prevention of miscalculations and misunderstandings,” she said.

“As to what the U.S. defense department said, I have to verify it with the military. But I think what they said is unreasonable as we have always said that for a long time the U.S. military has regularly sent ships and aircraft to carry out close up surveillance and military surveys in waters facing China, which threatens China’s sovereignty and security,” Hua told reporters.

“China is resolutely opposed to this and has always demanded the U.S. end these kinds of activities. I think this is the cause of this or similar incidents.”

The seizure has added to U.S. concern about China’s growing military presence and aggressive posture in the disputed South China Sea, including its militarization of maritime outposts.