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