The two sides appear to be at loggerheads, with both making long lists of demands the other won’t meet, analysts say.
President Donald Trump’s top economic advisers are returning home from Beijing with little more than glaring proof of how far apart the U.S. and China stand on trade issues.
A U.S. delegation led by Treasury Secretary Steven Mnuchin wrapped up two days of negotiations with Chinese economic officials Friday with only an agreement to keep talking. No time or place for further discussions was announced, with Trump’s threat to impose tariffs on as much as $150 billion in Chinese goods still looming.
The two sides appear to be at loggerheads, with both making long lists of demands the other won’t meet, analysts say. Trump wants China to cut its annual trade surplus with the U.S. by at least $200 billion by the end of 2020 and not retaliate for U.S. tariffs. China wants the U.S. to stop an investigation into the country’s acquisition of sensitive American technologies.
“The meetings this week are unlikely to lead to more than a very temporary cessation of hostilities,” said Eswar Prasad, a China expert at Cornell University. “We’re going to see the trade tensions if anything flare up even more because it has become clear that the U.S. wants a great deal from China and expects China to capitulate, and the Chinese are up for negotiation, not capitulation.”
While a cure-all deal was always a longshot, the discord between the world’s two biggest economies means skittish global markets will continue to face trade tensions. The immediate question is whether the U.S. saw enough progress to delay Trump’s planned tariffs on Chinese imports. The duties can be imposed after a public comment period ends May 22.
The White House characterized the talks as a “frank” exchange and said the U.S. delegation in Beijing stressed that fairer trade would help boost economic growth, even for China. Trump will “seek his decision on next steps” after a briefing from the delegation, according to the White House.
The president hinted his administration will take action.
“We will be doing something one way or the other with respect to what’s happening in China,” Trump said Friday in D.C. “Let me say this: I have great respect for President Xi, that’s why we’re being so nice, and we have a great relationship, but we have to bring fairness into trade between the U.S. and China, and we’ll do it.”
Experts had expressed doubts that Trump’s team would make a breakthrough, given the differing ideologies within the large U.S. delegation. Mnuchin was joined by Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer, as well as two senior White House officials — economic adviser Larry Kudlow and trade adviser Peter Navarro — and the U.S. ambassador to China, Terry Branstad.
“The size and high level of this delegation illustrates the importance that the Trump administration places on securing fair trade and investment terms for American businesses and workers,” according to the White House statement.
China’s Vice Premier Liu He had earlier requested that the U.S. designate a single point person for the economic relationship.
China’s official Xinhua news agency reported Friday that both sides reached a consensus on some trade issues while acknowledging major disagreements on other matters. It said they would continue talks. In an editorial, the official China Daily reiterated that President Xi Jinping’s government won’t back down from its agenda in the face of pressure from the U.S.