Daily Management Review

“Productive” Talks Bring US & China Closer To A Trade Deal, End To Some Tariffs


According to a report on Politico, there can be a partial roll back of a part of the tariffs imposed on $250 billion worth of Chinese products imported into the US following the nearing of a trade agreement between the United States and China. The two countries completed “productive” talks in Beijing, U.S. Treasury Secretary Steven Mnuchin said earlier.
A daylong meeting aimed at bringing an end to the ongoing trade war was held between Chinese Vice Premier Liu He and Mnuchin, along with U.S. Trade Representative Robert Lighthizer. The two parties are set to meet again next week in Washington and some experts are expecting the announcement of the trade deal after that meeting.
“Ambassador Lighthizer and I just concluded productive meetings with China’s Vice Premier Liu He. We will continue our talks in Washington, D.C. next week,” Mnuchin wrote on his Twitter account but did not provide any details.
The three negotiators were seen chatting amicably with each other when they appeared before photographers after the meeting in Beijing.
“The discussions remain focused toward making substantial progress on important structural issues and rebalancing the U.S.-China trade relationship,” White House Press Secretary Sarah Sanders told pool reporters, adding only scheduling details.
The sticky issue of how to enforce the agreement has been resolved by the two sides, reported the Politico quoting two sources with knowledge of the matter. No further details were however available. However sources reported that the framework of the implementation strategy would be similar to a framework as described by Lighthizer to members of Congress which entailed holding of a series of meetings so that the complaints about China’s compliance with the accord would be addressed. That would end up in imposition of unilateral U.S. tariff actions in case of disputes being unresolved.
There were no comments available from a USTR spokesman on the Politico report.
“To the extent that there are issues that cannot be resolved at the vice-premier level, then the United States would have the right to act unilaterally to enforce. This mechanism I described did not exist in past dialogues,” Lighthizer said in written replies to questions on the Senate Finance Committee website on Wednesday.
The Politico report said that a trade deal between the US and China would include the US immediately lifting the 10 per cent tariffs imposed on Chinese goods imported into the US and which is part of the increased tariffs imposed on Chinese goods worth $200 billion. After that the rest of the tariffs would be removed in a phased manner “quickly”, reported the Politico.
An enforcement mechanism for a deal and timelines for lifting tariffs are sticking points, US officials have said privately.
Progress on some of the contentious issues such as intellectual property and forced technology transfer have been made, Beijing and Washington had said earlier. Both the sides had expressed hope that the resolution of those points would help in them coming to a trade agreement and ending a trade war that had upended global markets and global supply chains.
While admitting that the enforcement mechanism was crucial, Chinese officials have also warned that any agreement on it must be beneficial to both sides and the US should not put restrictions on China in the name of enforcement.