China-US trade talks: Trump meets Chinese Vice Premier Liu He

08 April, 2019, 03:30 | Author: Emmett Rice
  • US President Donald Trump watches as China's Vice Premier Liu He speaks with US Trade Representative Robert Lighthizer in the Oval Office of the White House in Washington DC on Feb 22 2019. Trump is likely to meet Liu again during the lates

US President Donald Trump said on Thursday that the United States and China are "rounding the turn" in a lengthy negotiation over trade and predicted that "something monumental" and great for both countries could be announced in a matter of weeks.

A final sticking point appears to be when and how Washington will agree to lift the steep tariffs it has placed on more than Dollars 250 billion in Chinese imports.

That has left negotiators diametrically opposed: China wants all tariffs that have been imposed in the course of the past 12 months removed, while the US wants to retain some as part of its enforcement mechanism.

Trump is on record saying the administration's tariffs on $250 billion in Chinese goods would stay irrespective of a deal.

While the president sounded an optimistic tone about the chances for a deal to be reached, his top trade negotiators were far more cautious in their remarks during the meeting Thursday. They said tariffs on imports from China and other countries have squeezed the US real income by $1.4 billion a month and similar effects are falling on countries that retaliated against the United States. A person familiar with the text said China so far agreed only to contemplate not to retaliate if the U.S. took action against Beijing, but stopped short of a formal pledge to refrain from counter-punches.

President Xi Jinping says that China and the USA have made substantial progress in trade talks and is calling for an early conclusion to negotiations. During his presidential campaign, he assailed China for the "rape" of the American economy.

He added, "It's got to be some enforcement mechanism that future Congresses and presidents can believe will work, because it just can't be, you know, a deal in name only".

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"Even once we are done with the USA and China, the USA will turn to Europe", Laurence Boone, chief economist at OECD, told CNBC's Steve Sedgwick at the Ambrosetti Workshop in Italy on Friday.

William Reinsch, a trade expert at the Centre for Strategic and International Studies and former Commerce Department official for exports, pointed to Beijing's boycott of USA soybean exports a year ago.

The nine-month trade war has disrupted supply chains, whipsawed markets and weighed on the world economy. -China standoff is reducing trade and creating uncertainty for businesses trying to decide where to make investments.

Though Trump has been pushing for the Chinese leader to travel to the U.S.to sign a trade deal, the Chinese leader is unlikely to do so unless the agreement is 100 percent complete. China too slapped reciprocal tariffs on some United States products.

China is pushing for the tariffs to be removed before it will agree to lift its retaliatory tariffs on USA farm products and industrial goods including autos. Trump advisers say China has failed to meet commitments in the past, one reason they decided early in the president's term to emphasize the stick over the carrot.

Initial reports on Thursday in The Wall Street Journal and The New York Times were that Mr Trump would announce a summit with Mr Xi. One of the outstanding points is how numerous U.S. tariffs will be lifted immediately and how many will stay on for some time.

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