US, China to re­sume trade talks in Oc­to­ber

The Korea Times - - WORLD -

BEI­JING (AFP) — China and the United States will re­sume trade talks in Wash­ing­ton in early Oc­to­ber, Bei­jing said on Thurs­day, al­lay­ing fears that new puni­tive tar­iffs would lead to a break­down in the pro­tracted ne­go­ti­a­tions.

The world’s two big­gest economies have been em­broiled in a tense year­long tar­iffs row, which es­ca­lated on Sept. 1 when both sides swapped fresh levies on goods worth hun­dreds of bil­lions of dol­lars.

The talks were sup­posed to have re­sumed this month but China’s com­merce min­istry said Vice Pre­mier Liu He, Bei­jing’s point­man on trade, agreed to Oc­to­ber in a phone call with U.S. Trade Rep­re­sen­ta­tive Robert Lighthizer and Trea­sury Sec­re­tary Steven Mnuchin on Thurs­day.

The of­fi­cials agreed to “work to­gether and take prac­ti­cal ac­tions to cre­ate fa­vor­able con­di­tions for con­sul­ta­tions,” the min­istry said in a state­ment. It added both sides would “main­tain close com­mu­ni­ca­tion” ahead of the talks.

The news will be seen as a sign of op­ti­mism in a trade war that has weighed on the global econ­omy and stock mar­kets while also shaking diplo­matic re­la­tions be­tween the two global pow­ers.

The top of­fi­cials last met in Shang­hai in July for dis­cus­sions that were de­scribed as “con­struc­tive” but ended with no an­nounce­ments.

U.S. Pres­i­dent Don­ald Trump soon after­wards said he would in­crease tar­iffs on more than half-a-tril­lion dol­lars’ worth of im­ports, prompt­ing Bei­jing to re­spond with fresh tar­iffs on U.S. goods worth $75 bil­lion. Those were the levies that kicked in this month.

Ten­sions con­tin­ued to mount over the sum­mer, with Trump ear­lier this week ac­cus­ing Chi­nese ne­go­tia­tors of hold­ing out for a bet­ter deal in hopes he will be voted out in next year’s pres­i­den­tial elec­tions.

The U.S. pres­i­dent has also claimed China is be­ing forced back to the ne­go­ti­at­ing ta­ble be­cause of the coun­try’s slow­ing econ­omy.

Pol­icy tools

Of­fi­cials in Bei­jing on Wed­nes­day dis­cussed new mea­sures to keep the coun­try’s econ­omy grow­ing in the face of an “in­creas­ingly com­pli­cated and chal­leng­ing ex­ter­nal en­vi­ron­ment”, ac­cord­ing to an of­fi­cial state­ment.

Pol­icy tools pro­posed at a State Coun­cil ex­ec­u­tive meet­ing chaired by Pre­mier Li Ke­qiang in­clude cuts to the amount of cash banks must keep in re­serve to en­cour­age more lend­ing, es­pe­cially to smaller and medium-sized busi­nesses. An in­crease in the use of lo­cal gov­ern­ment bonds to fi­nance in­fra­struc­ture projects was also put for­ward.

This week econ­o­mists in­clud­ing Bloomberg Eco­nom­ics cut their fore­casts for China’s eco­nomic growth in 2020 to be­low 6.0 per­cent as a re­sult of in­creas­ing risks from the tar­iff war with the U.S.

But while Trump points to China’s weak­en­ing econ­omy, ob­servers warned that a sur­vey Tues­day show­ing the U.S. man­u­fac­tur­ing sec­tor had con­tracted for the first time in three years was a wor­ry­ing sign.

At the re­cent Group of Seven meet­ing in France, Trump spoke of new com­mu­ni­ca­tions be­tween U.S. and Chi­nese ne­go­tia­tors — giv­ing fi­nan­cial mar­kets a brief boost — though China’s for­eign min­istry said it was un­aware of such con­tacts.

AFP-Yon­hap

A Chi­nese and US flag at a booth dur­ing the first China In­ter­na­tional Im­port Expo in Shang­hai in this Nov. 6, 2018 file photo.

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