/Trump Optimistic on Trade Deal With China, but May Keep Tariffs Anyway

Trump Optimistic on Trade Deal With China, but May Keep Tariffs Anyway


WASHINGTON — President Trump expressed optimism Thursday about reaching a landmark commerce cope with China, but mentioned in an interview that he would take into account leaving in place some tariffs on Chinese items even when the 2 sides strike an settlement.

“Without the tariffs, we wouldn’t be talking,” Mr. Trump mentioned in an interview with The New York Times, shortly after his administration concluded two days of high-level commerce talks with Chinese officers. “And I make this point clear to them.”

As he hosted the Chinese delegation within the Oval Office earlier within the day, Mr. Trump mentioned he would meet subsequent month with the Chinese president, Xi Jinping. He prompt that Mr. Xi was ready to make vital adjustments to Beijing’s financial insurance policies, together with opening its market to American firms and shopping for extra merchandise.

To buttress his level, Mr. Trump had a letter from Mr. Xi — crammed with flattery of Mr. Trump and guarantees to make huge purchases of American agricultural merchandise — learn aloud to reporters. Liu He, China’s vice premier and Beijing’s commerce negotiator, instructed the president that Mr. Xi was dedicated to purchasing 5 million tons of soybeans, a pledge that caught Mr. Trump’s aides without warning.

“It’s a very short period of time for a deal this big. But it’s very possible,” Mr. Trump said in the interview with The Times. “I believe that a lot of the biggest points are going to be agreed to by me and him.”

The United States wants China to commit to buying American goods and services in large quantities to reduce America’s trade deficit, and to agree to make structural changes, including ending its practice of requiring American companies to hand over trade secrets as a condition of doing business there.

The surprise Chinese offer to buy soybeans attested to their gamesmanship and attempt to sway Mr. Trump with big numbers. It also left Mr. Lighthizer and his colleague, Larry Kudlow, the chief economic adviser, flummoxed during a briefing with reporters about whether the Chinese had pledged to buy five million tons of soybeans, or the more commonly used bushels.

After Mr. Lighthizer dispatched an aide to seek clarification, the White House confirmed that the Chinese offer was to buy five million tons.

An economist at the American Farm Bureau noted that in a normal year the United States exports about 35 million tons of soybeans to China, so the five million ton purchase is not as robust a gesture as Mr. Trump suggested.

The world’s two largest economies have been locked in a monthslong standoff that has begun to slow global economic growth and rattled financial markets. Both countries are under increasing pressure to reach an accord: American companies with exposure to China have begun warning that the trade war is hurting profits, and the Chinese economy is growing at its slowest pace in years.

On Wednesday, Mr. Liu and the Chinese delegation began two days of talks with Mr. Lighthizer and Steven Mnuchin, the Treasury secretary. Mr. Trump said on Thursday that Mr. Mnuchin and Mr. Lighthizer would travel to Beijing in February, after the Chinese New Year holiday, to lay the groundwork for a meeting between the two presidents. One of the biggest issues to resolve, Mr. Lighthizer said, is how to ensure any commitment by the Chinese is enforceable.

“Trump’s apparent willingness to meet with Xi raises the odds of a deal that allows the U.S. to claim at least a partial victory and avoid any further escalation of trade tensions,” said Eswar Prasad, the former head of the International Monetary Fund’s China division.

“Both sides seem to want to reach a negotiated settlement,” he said, “and for Trump, the political benefits to striking some sort of deal now probably outweigh the benefits of continuing to maintain a tough and inflexible posture against China.”

Business groups in the United States have been pleading with the administration to resolve the trade war, which has dented consumer sentiment in both countries and begun to raise prices for Chinese imports. While many American businesses agree that China needs to change its ways, the tit-for-tat tariffs have started to hurt manufacturers and technology companies, including Apple and Caterpillar.

Myron Brilliant, the head of international affairs at the U.S. Chamber of Commerce, who has been briefed on the talks, said China had shown some willingness to make reforms on market access and intellectual property. However, China has been highly reluctant to budge on sensitive subjects such as technology transfer and subsidies of state-owned enterprises. For that reason, there are significant gaps between the two sides.

“I would now say we are at halftime of the Super Bowl of trade relations,” Mr. Brilliant said. “There is still work to be done.”



Source link Nytimes.com

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