Trump and China’s Xi agree to restart trade talks, put a hold on new tariffs
President promises China will boost food purchases
OSAKA, Japan — President Donald Trump has agreed to restart trade talks with China and hold off new tariffs and certain restrictions on the star Chinese technology company Huawei, marking the latest cease-fire in his roller coaster trade battle with Beijing.
Trump made the announcement Saturday after meeting with Chinese President Xi Jinping at the Group of 20 economic summit in Japan. Trump said the Chinese, for their part, will be buying a “tremendous amount” of U.S. farm and food products, though neither he nor Xi offered any details about this pledge.
Taken together, the actions appear likely, for now, to de-escalate trade tensions that had been threatening the world economy. By themselves, however, they do not bring the two sides closer to narrowing the key gaps underlying their dispute, such as U.S. demands for structural changes in China’s state-controlled economy.
“The fundamental issues of U.S.-China trade conflict are still unresolved, though both Trump and Xi could go home to give hope to their constituents, assuring they will be resolved in the end,” said Ho-fung Hung, professor of political economy at Johns Hopkins University.
Beijing had said that a precondition for reaching a trade deal would be a reversal of the Trump administration’s blacklisting of Huawei Technologies Co. on national security grounds.
A few days after U.S.-China trade talks broke down in May, the Commerce Department placed Huawei on its so-called entity list, making it very difficult for U.S. companies to sell critical chips and other components to the telecom giant.
Huawei is a global leader in the development and manufacturing of the next-generation 5G mobile networking equipment, and its status has become a focal point in a widening dispute between the two countries over trade, technology and security matters.
Trump did not remove Huawei from Commerce’s entity list, and the company faces other U.S. restrictions as well. Trump said, however, that Huawei would be a matter for consideration at the final stage of the trade talks.
On Saturday, Trump left somewhat vague exactly what Huawei would be allowed to buy, but his statements drew immediate fire from members of Congress.
“If President Trump has in fact bargained away the recent restrictions on #Huawei, then we will have to get those restrictions put back in place through legislation,” tweeted Sen. Marco Rubio, R-Fla.
Trump defended his decision on Huawei as good for America’s business.
“We sell to Huawei a tremendous amount of product that goes into the various things that they make, and I said that’s OK, we will keep on selling that product. These are American companies,” Trump said during a news conference that lasted more than an hour at the close of the G-20 summit.
In an apparent exchange, Trump said, China would be buying a large but unspecified amount of U.S. agricultural products even as the two sides negotiate.
“We’re going to give them lists of things we want them to buy,” Trump said. “It’s going to be great for our farmers.”
China’s official statement on the talks published Saturday on the state-owned Xinhua news agency said Trump and Xi agreed to resume trade talks “on the basis of equality and mutual respect.”
But there was no joint statement of what Trump and Xi agreed to, and it is not clear how the two sides would interpret such language. Also, there were questions about what pledges the Chinese made on farm purchases, which Beijing has repeatedly offered in the past.
“The lack of formal statements and the disagreement already on Chinese ag commitments aren’t a good sign,” said David Loevinger, an analyst for TCW Emerging Markets Group in Los Angeles and a former senior Treasury Department official for China affairs.