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US-China trade talks open in Beijing
BEIJING, March 28, 2019 (BSS/AFP) – The United States and China open the
latest round of their trade talks Thursday as the economic superpowers edge
towards a deal to resolve a months-long spat that has rattled the global
economy.
The two-day meetings between US Trade Representative Robert Lighthizer and
Treasury Secretary Steven Mnuchin with China’s top economic official Liu He
is the first since China put into law new measures seen as an olive branch in
their high-stakes stand-off.
However, while US President Donald Trump has voiced hope that he could
soon hold a signing ceremony with his Chinese counterpart Xi Jinping,
negotiations have dragged on, suggesting substantial differences remain.
Global markets have rallied for much of this year on growing optimism the
two sides will eventually reach an agreement.
But Lighthizer sought to play down expectations ahead of the meeting in
Beijing, which is due to be followed by more talks in Washington in early
April.
“I’m hoping but not necessarily hopeful… If there’s a great deal to be
gotten, we’ll get it — if not, we’ll find another plan,” he told National
Public Radio earlier this week.
The two sides have slapped tariffs on hundreds of billions of dollars of
goods since last year, hitting a slew of businesses ranging from
manufacturers to farmers in both countries, with knock-on effects for other
economies.
Trump suggested last week some of those tariffs should stay in place after
a deal is reached to ensure China follows through.
Beijing has taken steps to address some US complaints.
Earlier this month China’s rubber-stamp parliament rushed through a law
that seeks to protect foreign firms from the forced transfer of technology.
And Premier Li Keqiang pledged a step up of punishment for intellectual
property infringers to “ensure violators have no place to hide”, addressing a
major bone of contention in Washington.
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“The kinds of things that we’re asking for are not anti-Chinese at all,”
Lighthizer said on NPR. “Protection of intellectual property is not anti-
Chinese. Stopping people from forcing transfer of technology is not anti-
Chinese.
“In fact, the reformers would say it’s pro-Chinese. It will help their
economy, not hurt their economy.”
– Remaining differences –
Negotiators hope to iron out remaining differences on other issues
including Beijing’s subsidies to state-owned firms and policies to build up
Chinese firms in strategic sectors.
“In our conversations with the US government they’ve indicated that
subsidies which create an uneven playing field between foreign and domestic
companies are most definitely something that continues to be negotiated,”
said Jacob Parker, vice president of the US-China Business Council.
“I suspect this is one of the areas China is pushing back on, (and) it
remains a core of the negotiations,” Parker said.
Beijing made no mention of its controversial Made in China 2025 industrial
policy — which had called for Chinese firms to take control of many
strategic industries — when Li laid out policy plans for the year.
Still analysts say Beijing’s push for self-reliance and indigenous
innovation will continue in practice.
Foreign tech companies have also long been locked out of China’s market
with many services such as Google, Facebook and Amazon blocked or facing
restrictions.
Beijing has yet to give in to demands it allow greater market access to
foreign cloud computing providers or loosen restrictions on overseas data
transfer, the Financial Times reported this week.
At a recent forum on the issue, Chinese academics and bureaucrats
criticised related US policies.
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“China does not trust the US government… we don’t believe that once our
data is in America, the US government will handle it appropriately,” said Xu
Chengjin of the Ministry of Industry and Information Technology.
American lawmakers and regulators have expressed similar concern about
sharing US data with Chinese firms.
– Enforcement –
The two sides also need to resolve when to remove the punitive tariffs on
billions of dollars’ worth of goods and how to enforce any deal.
“The question will be the details and enforceability,” Lighthizer said,
outlining a mechanism for US companies facing problems in China to bring
cases to the US Trade Representative to discuss with its Chinese
counterparts.
“They’re committed to do this, but it’s going to be a question of whether
they can get all the layers of government, I think, to follow through,” he
said.
Trump said last week he wanted to keep the current 25 percent duties on a
$50 billion tranche of Chinese imports, adding “we need that”.
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