Following an agreement between United States president Donald Trump and his Chinese counterpart Xi Jinping, trade representatives of both the countries would restart stalled negotiations to try and iron out a deal to bring an end to a trade war between the two largest economies of the world that has been going on for more than a year. The talks are slated to resume later this week.
The meeting between Trump and Xi which took place on the sidelines of the G20 Summit in Japan at the end of last month also resulted in the Trump administration deciding suspend a new round of tariffs on Chinese imports of consumer goods worth $300 billion.
While announcing the thawing of ice in Japan, Trump had then said that more purchase of US agricultural commodities would be made by China and in return some export restrictions on Chinese telecom equipment giant Huawei Technologies would be made by the US.
However, according to reports quoting sources, analysts and China trade watchers in Washington, the agreement between the two leaders in Japan did little to resolve the major sticking point between the two parties that resulted in talks being stalled earlier in May.
A phone call between US Trade Representative Robert Lighthizer, Chinese Vice Premier Liu He and Treasury Secretary Steven Mnuchin is expected to restart the trade negotiations, said reports quoting a US official last week. The call was expected this week, said a report quoting a USTR spokesman.
The major sticking points that has held up a trade deal between the two countries is the demand by the US that China should implement wide ranging policy changes to ensure protection of American intellectual property rights, stop forced transfer of American technology through joint ventures with Chinese companies and prevent cyber theft of trade secrets. US is also demanding China stops the huge subsidies that it gives to its state held companies. According to reports, the US believes that these would potentially threat the American dominance in the high-tech industries of the future, from artificial intelligence to aerospace.
"We've had a change in atmospherics," said Derek Scissors, a China expert at the American Enterprise Institute, a business-oriented Washington think tank. "While this is great for markets, the administration has not said one specific thing about how we're unstuck." According to Scissors, the outcome form the G20 summit should be satisfying for the time being for both sides as both wanted a cooling down of the heated US-China relations and avoiding imposing of fresh and increased tariffs which has hit both the countries economically.
"The pressure for one side to give into the other is diffused right now. I expect this to drag out for months," Scissors added.
(Source:www.moneycontrol.com)
The meeting between Trump and Xi which took place on the sidelines of the G20 Summit in Japan at the end of last month also resulted in the Trump administration deciding suspend a new round of tariffs on Chinese imports of consumer goods worth $300 billion.
While announcing the thawing of ice in Japan, Trump had then said that more purchase of US agricultural commodities would be made by China and in return some export restrictions on Chinese telecom equipment giant Huawei Technologies would be made by the US.
However, according to reports quoting sources, analysts and China trade watchers in Washington, the agreement between the two leaders in Japan did little to resolve the major sticking point between the two parties that resulted in talks being stalled earlier in May.
A phone call between US Trade Representative Robert Lighthizer, Chinese Vice Premier Liu He and Treasury Secretary Steven Mnuchin is expected to restart the trade negotiations, said reports quoting a US official last week. The call was expected this week, said a report quoting a USTR spokesman.
The major sticking points that has held up a trade deal between the two countries is the demand by the US that China should implement wide ranging policy changes to ensure protection of American intellectual property rights, stop forced transfer of American technology through joint ventures with Chinese companies and prevent cyber theft of trade secrets. US is also demanding China stops the huge subsidies that it gives to its state held companies. According to reports, the US believes that these would potentially threat the American dominance in the high-tech industries of the future, from artificial intelligence to aerospace.
"We've had a change in atmospherics," said Derek Scissors, a China expert at the American Enterprise Institute, a business-oriented Washington think tank. "While this is great for markets, the administration has not said one specific thing about how we're unstuck." According to Scissors, the outcome form the G20 summit should be satisfying for the time being for both sides as both wanted a cooling down of the heated US-China relations and avoiding imposing of fresh and increased tariffs which has hit both the countries economically.
"The pressure for one side to give into the other is diffused right now. I expect this to drag out for months," Scissors added.
(Source:www.moneycontrol.com)
