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US and China seek deal to prevent trade-war escalation
BEIJING, Feb 14, 2019 (BSS/AFP) – US and Chinese negotiators on Thursday
kicked off two days of high-level talks that President Donald Trump says
could decide whether he escalates the bruising tariff battle between the
world’s two biggest economies.
Trump indicated this week he was open to extending a trade truce beyond
March 1 depending on progress in Beijing. He is considering pushing the
deadline back an additional 60 days, Bloomberg News reported, citing sources.
In December he postponed plans to sharply hike tariffs on $200 billion of
Chinese imports to allow more time for negotiation.
The two economic superpowers have already imposed duties on more than $360
billion in two-way trade, which has weighed on their manufacturing sectors
and shaken global financial markets.
US Trade Representative Robert Lighthizer and Treasury Secretary Steven
Mnuchin are meeting with China’s top economic czar Liu He, seeking to build
on progress made in Washington last month.
We are “looking forward to discussions today”, Mnuchin said as he left his
hotel Thursday morning for the talks.
Expectations for a trade deal have grown as China faces pressure from
slowing economic growth, and as swooning global markets pose a challenge to
Trump and his economic advisors.
Data released Thursday in China showed its trade surplus with the US — a
major source of anger within the Trump administration — narrowed in January
to $27.3 billion, even as its American imports plunged 41 percent for the
month from a year earlier.
Last year the surplus hit a record $323.3 billion.
China’s total imports also sank for the month, pointing to weak demand
amid slowing economic growth.
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– Trump-Xi meeting –
Chinese President Xi Jinping plans to meet with the US officials in
Beijing this week, a report in the South China Morning Post said Wednesday,
bolstering hopes for the talks and world markets.
Trump also has said he expects to meet with Xi “at some point” to clinch a
trade deal.
Trump told reporters in the Oval Office on Wednesday that preliminary
talks in Beijing were “going along very well,” Bloomberg reported.
“They’re showing us tremendous respect,” he added.
“Markets will continue to watch — and react — closely to the ups and
downs of the negotiations,” said Trey McArver of Trivium Research.
“But Sino-US relations are all about the two leaders, and it will
ultimately be up to Xi and Trump to come to a deal — or not,” he wrote
Wednesday in a newsletter.
The two sides said major progress was made in talks last month in
Washington, but a wide gulf remains on some issues.
The US is demanding far-reaching changes to Chinese practices that it says
are unfair, including theft of US technology and intellectual property, and
myriad barriers that foreign companies face in the Chinese domestic market.
Beijing has offered to boost its purchases of US goods but is widely
expected to resist calls for major changes to its industrial policies such as
slashing government subsidies.
The International Monetary Fund warned on Sunday of a possible global
economic “storm” as world growth forecasts dip, citing the US-China trade row
as a key pivot point.
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