China and US to resume talks to resolve trade war

BEIJING: China will dispatch Vice Commerce Minister Wang Shouwen to the US for low-level trade talks in late August, the first official exchanges since earlier negotiations broke down two months ago.

The Chinese delegation led by Wang will meet with an American group led by David Malpass, under secretary for international affairs at the Department of the Treasury, at the invitation of the US, China’s Ministry of Commerce said in a statement on its website yesterday.

The news buoyed risk sentiment in Asian trading, with futures on the S&P 500 Index rallying as much as 0.4%. The offshore yuan gained against the dollar for the first time in seven days.

“This will be talks about trade talks,’” said Gai Xinzhe, an analyst at the Bank of China’s Institute of International Finance in Beijing. “Lower-level officials will meet and haggle and see if there is a possibility for higher-level talks.”

China’s equity market has suffered declines and the yuan has been on a losing streak for more than a month.

Chinese authorities, bracing for an economic fallout, have introduced measures to support growth ranging from shifting toward a more accommodative monetary policy to boosting fiscal spending.

The two nations had appeared to have reached a deal in May after Chinese Vice Premier Liu He – President Xi Jinping’s top economic adviser – led a group of officials to Washington.

But Trump backed away from the agreement soon afterward, and ever since the two sides have been locked in a trade standoff as they slapped tariffs on billions of dollars of each other’s goods.

The commerce ministry reiterated in the statement that China is against trade protectionism and won’t accept any unilateral trade restrictions. “China welcomes communications and dialogue on the basis of reciprocity, equality and integrity,” it said.

Wang, who is the key official leading China’s trade talks worldwide, led an advance team to Washington in May.

In a July interview, he told Bloomberg that he didn’t understand why the US quickly reversed its course.

“Good faith negotiation is required,” Wang said then.

“For any talk to be successful, no party should point a gun at the other party.” — Bloomberg