President Donald Trump said he may meet Chinese president Xi Jinping next month (March) to finalise a trade deal that is “more likely” to happen than not, suggesting that a deal to end the trade dispute between the world’s two largest economies may be on the horizon.
The latest round of US-Chinese trade talks in Washington were originally scheduled to wrap up on Friday (Feb 22), but went so well that the Chinese trade delegation has extended its trip, said Mr Trump and Treasury Secretary Steven Mnuchin.
The Chinese negotiators will continue meetings with their US counterparts through the weekend, and will now depart Washington on Sunday night or Monday instead.
“I would say it’s more likely that a deal will happen,” Mr Trump told reporters at the Oval Office before his meeting with the Chinese trade delegation, led by Chinese vice-premier Liu He. “The fact that they’re willing to stay for a quite a bit longer period, doubling up the time, that means something.”
Mr Trump said he remained open to extending the March 1 deadline for negotiators to reach an agreement, failing which US tariffs on US$200 billion (S$270 billion) of Chinese goods will be raised from 10 to 25 per cent, if he saw substantial progress being made.
He added that his meeting with Mr Xi would probably take place at his Mar-a-Lago estate in Florida, where both presidents previously met in April 2017.
The US and China also sealed a deal on currency manipulation, said Mr Trump, who declined to give further details.
Said Mr Liu: “From China, we believe that is very likely that it will happen and we hope that ultimately we’ll have a deal. And the Chinese side is ready to ready to make our utmost effort.”
CNBC reported that China committed to buying up to US$1.2 trillion of US goods to reduce the trade deficit the US has with China, one of Mr Trump’s main concerns but not necessarily that of his administration’s officials.
But no breakthrough was announced on the issues of unfair trade practices such as forced technology transfers and unequal market access, with CNBC reporting that the US and China still remained far apart on these fundamental issues.
The two sides made positive progress in trade balance, agriculture, technology transfer, intellectual property protection and financial services, the official Xinhua News Agency reported Mr Liu as saying.
Negotiators are working on memorandums of understanding on Chinese reforms that would underpin a final deal, covering areas including agriculture, non-tariff barriers, services, technology transfer and intellectual property, reported Reuters on Wednesday.
What the US was seeking to achieve were “structural changes in China” affecting trade, said the White House in a press statement on Monday (Feb 18), a day before the latest round of trade talks started.
The news on Friday suggested that low-hanging fruit such as reducing the US-China trade deficit had been plucked, and the remaining challenges were much harder.
“It sounds like the easy wins have been made,” wrote China commentator Bill Bishop in Axios news website. “The Chinese have resisted significant concessions and it’s not clear what leverage the American president wants to use before March 1 to convince them to move much more.”
Said Mr Trump: “Ultimately, I think the biggest decisions and some even smaller decisions will be made by President Xi and myself. And we expect to have a meeting some point in the not too distant future and I can only say talks are going along well, but we’re going to have to see what happens.”
The US and China are negotiating to resolve a trade dispute centered around China’s alleged unfair trade practices, including forced technology transfers and market access, and the US’ trade deficit with China.
If they fail to reach an agreement by March 1, the scheduled increase of US tariffs on US$200 billion worth of Chinese goods from 10 per cent to 25 per cent will go ahead at the stroke of midnight on March 2.
Said Mr Trump: “I think there’ll be some points that this group won’t agree on because maybe they’re not supposed to agree on or allowed to agree on. And I think President Xi and I will work out the final points. Perhaps and perhaps not.”
Mr Xi, in a message read out at the Oval Office, said he was pleased to note the economic teams had engaged in intense talks and made significant progress since he and Mr Trump met in Argentina last November after the G-20 summit.
“This has been well received in both our countries and with the wider international community. It is my hope that our two sides will continue to work together in a spirit of mutual respect and … cooperation and could redouble our efforts so as to meet each other halfway and reach an agreement that works for our mutual benefit,” said the Chinese president in the message.
Mr Trump also said that the issue of Chinese tech giant Huawei and its indicted chief financial officer Meng Wanzhou, whose arrest ignited a diplomatic row between China and Canada last December, could be part of a deal.
“We’ll be talking about it. We may or may not include that in this deal,” Mr Trump said.