With two days of high-level trade talks between the United States and China kicking off in Washington Thursday, US President Donald Trump took to his favourite platform – Twitter – to say that he will personally meet with the head of China’s trade negotiating team, Chinese Vice Premier Liu He, on Friday in Washington.
But Trump also injected an element of suspense, paying his cards close to his vest on whether the world’s two largest economies are any closer to achieving a breakthrough in their increasingly contentious and sprawling trade war.
“Big day of negotations with China. They want to make a deal, but do I?'” Trump tweeted. “I meet with Vice Premier tomorrow at The White House.”
The past 24 hours have seen reports surface that have painted conflicting pictures of the horse-trading happening behind closed doors in Washington.
The South China Morning Post reported that the Chinese delegation would end talks a day early, after deputy-level negotiations earlier this week between Beijing and Washington failed to make headway on key issues.
The New York Times reported that the US is considering making concessions to China including issuing licences to US companies allowing them to supply non-sensitive components to Chinese telecoms giant Huawei.
And Bloomberg News reported that Washington was considering making a currency pact with Beijing and suspending scheduled tariff hikes on Chinese goods next week.
Trump is set to increase the tariff rate on $250bn worth of Chinese goods to 30 percent from 25 percent next Tuesday.
The conflicting reports make for great drama, but the ongoing trade war is having very real consequences. Livelihoods around the world are at stake as economies get squeezed by slowing global trade volumes, supply chain disruptions and mounting uncertainty among businesses as to how to best position themselves for a breakthrough – or no breakthrough – in the US-China trade war.
A Wall Street Journal survey of economists released Thursday showed that two-thirds of forecasters believe the US manufacturing sector is in recession. Europe’s manufacturing is definitely in recession. Factory activity in Asia is also suffering.
Beyond tit-for-tat trading blows, the US-China trade war has spawned spin-off tensions.
On Monday, the US Department of Commerce blacklisted 28 Chinese entities including video surveillance firm Hikvision, citing human rights violations of Muslim minority groups in Xinjiang.
Chinese officials said the action interfered with China’s sovereignty.
Relations between the US and China have also been roiled this week by tit-for-tat bans on certain visas for each country’s officials and a controversy sparked by a Twitter post that was made by an executive with the National Basketball Association’s Houston Rockets and that supported anti-government protests in Hong Kong.