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TRADE WARS
China's top trade negotiator to visit US
By Ryan MCMORROW
Beijing (AFP) Jan 17, 2019

US officials consider lifting China tariffs: report
Washington (AFP) Jan 17, 2019 - US officials have considered lifting tariffs on Chinese imports to calm volatile stock markets and encourage Beijing to make concessions in current trade talks, The Wall Street Journal reported Thursday.

American and Chinese trade officials have until March 1 to resolve their trade war, to prevent a sharp increase in punitive US duties on $200 billion in Chinese goods.

Treasury Secretary Steven Mnuchin raised the idea of revoking tariffs on some or all of the $250 billion in Chinese goods impacted, during discussions on the strategy for the current talks but the question has not yet reached the White House, according to The Journal.

The US stock market reacted favorably to the report, with equities prices closing higher after being flat for most of the day.

The talks with Beijing are being led by US Trade Representative Robert Lighthizer, who has taken a more hard line position on trade than Mnuchin.

The Treasury Department told AFP on that the trade talks with China were "nowhere near completion."

"Neither Secretary Mnuchin nor Ambassador Lighthizer have made any recommendations to anyone with respect to tariffs or other parts of the negotiation with China," a spokesperson working with the trade team said by email.

CNBC quoted a senior White House official involved in the trade talks saying that Trump had no incentive to offer concessions, and officials instead were focused on preparations for talks with Chinese Vice Premier Liu He set for January 30-31 in Washington.

US President Donald Trump tweeted January 8 that the talks with Beijing were "going very well!"

But the trade war has rattled stock markets in the months since, putting pressure on the White House to reach a resolution.

Trump launched the trade war last year and the two sides have since exchanged tit-for-tat tariffs on more than $360 billion in two-way trade.

China's top trade negotiator will travel to the United States for talks later this month ahead of a March deadline to avoid bruising tariff hikes, the commerce ministry said Thursday.

Vice Premier Liu He will visit Washington on January 30-31 for the negotiations, the ministry said, following up on talks between lower-level officials in Beijing earlier this month.

President Donald Trump and Chinese leader Xi Jinping agreed to a three-month trade war truce in December, suspending US plans to increase tariffs on Chinese goods to give negotiators space to find a solution.

Liu and US officials will "hold negotiations on economic and trade issues and work together to push forward and implement the important consensus" reached by Xi and Trump, ministry spokesman Gao Feng told reporters.

But Liu's trip could run into complications after a Wednesday report said US authorities were in the advanced stages of a criminal probe that could result in an indictment of Chinese telecom giant Huawei.

Citing anonymous sources, the Wall Street Journal said the Department of Justice was looking into allegations of theft of trade secrets from Huawei's US business partners, including a T-Mobile robotic device used to test smartphones.

US lawmakers also introduced a bill to ban the export of American parts and components to Chinese telecom companies who are in violation of US export control or sanctions laws -- with Huawei and fellow Chinese firm ZTE the likely targets.

China blasted the US actions.

"The whole world is very clear that the real intention of the United States is to use every possible piece of state machinery to suppress and smear China's high-tech companies," said foreign ministry spokeswoman Hua Chunying.

The US lawmakers' actions reeked of "extreme arrogance," she said, adding: "The actions of the US are not the normal actions of a normal country, let alone the world's leading power."

Canada's arrest of Huawei's chief financial officer Meng Wanzhou at the request of the United States on fraud charges related to Iran sanctions violations has already infuriated Beijing. Meng is the daughter of the company's founder.

Two Canadians have been detained in China since Meng's arrest and a third has been sentenced to death on drug trafficking charges -- moves observers see as attempts by Beijing to pressure Ottawa over her case.

Huawei, the world's second-largest smartphone maker and biggest producer of telecommunications equipment, has for years been under scrutiny in the US over purported links to the Chinese government.

- Record surplus -

US officials have said last week's talks in Beijing "went just fine" but few details from the meeting have emerged.

Liu will travel at the invitation of US Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer, Gao said.

Washington has been clamouring for an end to the forced transfer -- and even theft -- of American technology, as well as steep government subsidies for Chinese companies.

The Trump administration also wants Beijing to buy more American goods to narrow a yawning trade gap and allow foreign players better access to the Chinese market.

China's trade surplus with the United States hit a record $323.3 billion in 2018, Chinese customs data showed on Monday.

However, in a sign that the White House's measures are beginning to have an impact, China's exports to the US sank in December.

The Trump administration has imposed tariffs on $250 billion worth of Chinese imports, prompting Beijing to hit back with duties on $110 billion in US products.

Without a resolution, punitive US duty rates on $200 billion in Chinese goods are due to rise to 25 percent from 10 percent on March 2.

While China grapples with the trade war, its economy has been slowing down.

Government officials have said China is expected to have hit its growth target of around 6.5 percent last year, down from 6.9 percent in 2017 and its slowest pace in almost three decades.

China will release its 2018 GDP growth data on Monday. Recent statistics point to a slowdown.

Annual passenger car sales fell last year for the first time in more than 20 years, as the trade war with the US rocked consumer confidence and Beijing reined in car financing channels.

And the cost of producing goods in China's factories slowed sharply in December, a sign demand remains weak, while consumer inflation also flagged.

Official data showed the manufacturing sector contracted in December for the first time in more than two years.


Related Links
Global Trade News


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