USA pushes China on promises after `in-depth' trade meetings

Ivan Schwartz
January 10, 2019

U.S. President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce in a trade war that has roiled global financial markets.

"The U.S. feels uncomfortable with China's rapid development, and can't adapt to its own declining influence", wrote Chen Yonglong in the state-run China Daily".

Still, the USA statement said the negotiations dealt with the need for any deal with China to be "subject to ongoing verification and effective enforcement" - a comment that reflects US frustration that the Chinese have failed to live up to past commitments.

Some degree of optimism followed a United States trade delegation home from Beijing on Wednesday, after the most comprehensive trade negotiations held yet between the world's two largest economies since a tit-for-tat tariff battle ensued previous year.

But the statement did not say if the two sides have reached any agreement during the talks that concluded on Wednesday.

If no deal is reached by March 2, USA tariffs on $200 billion Chinese goods will rise from 10 percent to 25 percent.

USA companies also want action on Chinese policies they complain improperly favor local companies.

That would not only squeeze corporate profitability at home, but also put pressure on global price gains, as export prices usually follow those at factory gate.

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Washington has been clamouring for an end to the forced transfer - and even theft - of American technology and intellectual property, as well as steep government subsidies for Chinese companies.

Companies that have been disappointed by Beijing's failure or delays in carrying out commitments want an enforcement mechanism with "some kind of penalty for not doing what they promised", said Parker. "It's probably going to take a little longer".

For its part, Beijing is unhappy with USA export and investment curbs, such as controls on "dual use" technology with possible military applications.

This week's talks went ahead despite tension over the arrest of a Chinese tech executive in Canada on U.S. charges related to possible violations of trade sanctions against Iran. He wouldn't confirm reports that Vice Premier Liu He will visit the U.S. soon to meet U.S. Trade Representative Robert Lighthizer.

While Chinese goods going to the US initially held up in the face of higher tariffs due to so-called front-loading, their value slumped in the final quarter of 2018, according to the latest available data.

But if the countries fail to reach a deal by March 2, Trump has threatened to restart the trade war, increasing tariffs on 200 billion dollars-worth of Chinese imports from ten to twenty-five percent. Forecasters expect American orders to slump this year.

Auto and property sales have slumped as Chinese growth fell to a post-global crisis low of 6.5 percent in the quarter ending in September.

The US economy grew at an annual rate of 3.4 percent in the third quarter but surveys show consumer confidence weakening.

Other reports by GizPress

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