WASHINGTON: USPresident Donald Trump said on Friday a trade summit with Chinese leader XiJinping was likely next month, and hailed two days of "very goodtalks" by negotiators. The negotiations were extended through Sunday asofficials race to reach a deal ahead of a deadline next week when US duty ratesare due to rise sharply.
But Trump againsaid he was considering pushing back the deadline for raising tariffs on morethan $200 billion in Chinese exports. "We expect to have a meetingsometime in a not too distant future," he said of the meeting with Xi."Probably fairly soon in the month of March." Xi also sounded apositive note in a letter delivered to Trump by China's lead negotiator Liu He.The Chinese president expressed hope that the talks maintain "a mutuallyrespectful, cooperative and win-win attitude" and lead to a "mutuallybeneficial" agreement.
"I am readyto maintain close contact with the President through various means,"state-run China Central Television quoted Xi's letter saying. Details remainedscant about any concrete progress in the seven-month-old trade war, which hasrattled global markets and prompted stark warnings about the risks to the worldeconomy. "I think there is a very, very good chance that a deal can bemade," Trump told reporters at the White House on a second day of tradenegotiations with Chinese officials. "If we are doing well, I could seeextending that" deadline for the end of the three month tariff truce.
And Trump said anagreement on currency manipulation will be included in the trade pact.Officials from Beijing also expressed optimism about a positive outcome."From China, we believe that it is very likely that it will happen,"Liu said, speaking through an interpreter.
Winning streak
Global stockmarkets were higher on expectations the two sides would avoid furtherdeterioration in their trade relations. Wall Street rose to a banner finish,posting its longest streak of weekly gains in nearly 24 years. Analysts say thetwo sides are likely to trumpet mutual agreements to resolve the easier partsof the trade dispute-increasing purchases of American goods, more openinvestment in China and tougher protections for intellectual property andproprietary technology.
The harder partscovering issues like scaling back China's ambitious industrial strategy forglobal preeminence, are another question. Christine Lagarde, head of theInternational Monetary Fund, again warned that the US-China trade tensions a"major risk" to world economic growth. Since July, the countries havehit out with tariffs on more than $360 billion in two-way trade.
While the tariffsalone are having "minimal" effect on global trade, they are damagingbusiness confidence and weighing on stock markets, Lagarde told the US radioprogram Marketplace on Thursday. "I cross my fingers every morning and mytoes every evening because I hope that it is going to end up with a way to fixthe system, not break it," she said. The IMF has cut its forecast forglobal growth this year due to the combined impact of the trade war.
Good faith
Beijing hasreportedly proposed an increase in its imports of US energy and agriculturalexports significantly. US AgricultureSecretary Sonny Perdue tweeted that China has committed to buying "anadditional" 10 million metric tons of soybeans as a "show of goodfaith," but he did not give any details or specify the timeframe.
Still, a broaderdeal could be difficult given the US demands for far-reaching structuralchanges. Gary Clyde Hufbauer, a trade expert at the Peterson Institute forInternational Economics, said China may have to remove its tariffs in order toincrease purchases of US goods, but Trump may feel no pressure to roll back theduties he imposed last year. "The big surprise would be a complete removalof tariffs by Trump but I'm expecting an asymmetrical removal of tariffs byChina in order to get to some of these numbers," he said.
China'sretaliation has hit US farm exports hard. The US Agriculture Departmentestimated this month that US soy exports would not turn to their pre-trade warlevels for another six years. William Reinsch, a former senior Treasuryofficial for trade in the administration of President Bill Clinton, told AFP arisk for Trump is whether any agreement holds and the Chinese honor theircommitments. "If it unravels and we have a string of unmet commitments andthen US retaliation right before the election, we're kind of right back wherewe started," he said. -AFP