Trump: US to restart trade talks with China

United States President Donald Trump said on Tuesday he has spoken to Chinese President Xi Jinping and that the two leaders’ teams would restart trade talks after a long lull in order to prepare for a meeting at the G20 summit later this month.

“Had a very good telephone conversation with President Xi of China,” Trump tweeted. “We will be having an extended meeting next week at the G-20 in Japan. Our respective teams will begin talks prior to our meeting.”

Trump has made no secret that – despite his threat to escalate the dispute with more US tariffs on Chinese goods – he would like to meet with Xi at the Group of 20 meeting in Japan next week.

And while Chinese state media have confirmed that Xi will attend the meeting with Trump, the top US trade representative, Robert Lighthizer, continues to express scepticism that talks will solve the many issues at hand. 

Washington has already imposed 25 percent tariffs on $250bn of Chinese goods that are imported to the US, ranging from semi-conductors to furniture.

And Trump has threatened to put tariffs on another $325bn of goods, covering nearly all of the remaining Chinese imports into the US, including products such as cell phones, computers and clothing.

Resuming contact

Chinese state media said Xi agreed to the meeting and emphasised in the call that economic and trade disputes should be solved through dialogue.

“The key is to show consideration to each other’s legitimate concerns,” Xi said. “We also hope that the United States treats Chinese companies fairly. I agree that the economic and trade teams of the two countries will maintain communication on how to resolve differences.”

The confirmation of a meeting avoids the possibility of a snub to Washington that could have triggered another round of tariffs.

The US and China are lingering in the middle of a costly trade war that has pressured financial markets and damaged the world economy.

High-stakes talks between the two sides to reach a broad deal broke down last month, and interaction since then has been limited.

Meanwhile, US stocks rallied on Tuesday, with the Standard & Poor’s 500 index closing in on record levels, as investors expressed optimism about China, as well as the prospect of a more accommodative US Federal Reserve.

Chip companies, which have sizable exposure to China, led the rally among tech stocks.

‘Stop cheating’

Even as markets rallied, on Capitol Hill there was less optimism about the prospects of a deal.

Tariffs on Chinese goods may not be enough to force Beijing to make economic reforms, the top US trade official said on Tuesday.

“I don’t know if it will get them to stop cheating, tariffs alone,” US Trade Representative Robert Lighthizer told lawmakers at a hearing of the Senate Finance Committee.

The tit-for-tat tariffs have disrupted international supply chains and slowed growth over the past year.

“I think you don’t have any other option. I know one thing that won’t work and that is talking to them.”

Washington wants changes that would rewrite the terms of trade between the two countries by improving intellectual property protections, halting forced technology transfers and industrial subsidies, and removing other barriers that hamper US businesses in China.

Even as Lighthizer was addressing the Senate committee, other officials were in the second of seven days of listening to public comments from US retailers, manufacturers and others that would be affected if Trump proceeds with the next round of tariffs.

Trump has ordered Lighthizer to prepare those tariffs, and says he will impose them if the meeting with Xi yields insufficient progress on the trade disputes.

“I don’t even know if we’re going to have the [additional] tariffs. It’s up to the president,” Lighthizer said as senators probed him on the cost of tariffs to US companies, farmers and consumers.