US, China trade negotiations positive as Beijing meetings continue

Gladys Abbott
January 10, 2019

A second day of trade dispute talks between the USA and China ended Tuesday without word of any progress, as an official newspaper warned not to push Beijing too hard.

These were the first direct talks between USA and Chinese officials since Presidents Donald Trump and Xi Jinping met in December in Argentina and agreed to a 90-day truce in their trade war.

-China talks raised hopes of easing trade tensions between the two superpowers, while OPEC-led crude output cuts also provided support.

Both sides have agreed to continuously keep in close contact.

The Trump administration wants the government of President Xi Jinping to alter its handling of technology and intellectual property held by foreign companies, and change plans for government-led creation of Chinese leaders in advanced technologies.

People familiar with the talks said the world's two largest economies were further apart on Chinese structural reforms that the Trump administration is demanding in order to stop alleged theft and forced transfer of U.S. technology and on how to hold Beijing to its promises.

United States officials also conveyed Trump's commitment to address his country's trade deficit with China and to resolve structural issues to improve trade between both countries, according to the USTR.

U.S. President Donald Trump argued that China has not treated the U.S. fairly in terms of trade. Trump said in a tweet on Tuesday.

The talks were seen as a litmus test of whether a lasting deal can be reached before March 2, when the Trump administration plans to hike tariffs on $200 billion of Chinese goods from 10% to 25%. Facing a March deadline, talks aimed at ending a trade war between China and the USA are underway, with the world's two biggest economies expressing optimism over the potential for progress. On Wednesday, White House press secretary Sarah Huckabee Sanders told the Fox Business Network, "We're optimistic".

Stocks rose globally after the United States and China concluded talks and appeared closer to an agreement, with all major us equities benchmarks rising. Japan's Nikkei 225 gained 1.1 percent and the Hang Seng in Hong Kong rallied 2.3 percent. They weren't expected to produce a final deal but optimism about progress had buoyed global stock markets this week.

Latest US-China Trade Talks Focus on China’s Pledge to Buy More US Goods – USTR

China also restarted purchases of American soybeans last month, providing relief for a crop hit by Chinese retaliatory tariffs.

"If the results of the talks are positive, it would be beneficial for both China and the USA and also a good news for the global economy", he added.

Oil prices jumped, helped by the hopes of easing trade tensions between China and the US, while OPEC-led crude output cuts also provided support.

The OPEC-led cuts, which officially began in January, are aimed at reining in an emerging glut as US crude output C-OUT-T-EIA has surged to a record 11.7 million bpd.

That issue was the first stressed in the statement released Wednesday, which noted that "the officials also discussed the need for any agreement to provide for complete implementation subject to ongoing verification and effective enforcement".

As the trade talks wound down, China's top economic official, Premier Li Keqiang, met with CEO Elon Musk of electric auto brand Tesla Inc.

U.S. Undersecretary for Trade and Foreign Agricultural Affairs Ted McKinney is chased by journalists as he walks into a hotel after a second day of meetings with Chinese officials in Beijing, Tuesday, Jan. 8, 2019. "I really believe they want to make a deal".

Both sides have actively implemented the significant consensus reached by the leaders of the two countries and conducted extensive, in-depth and detailed exchanges on trade and structural issues of common concern, said the statement.

"Talks with China are going very well!". Those include subsidies and other favors for high-tech and state-owned industry, rules on technology licensing and preferential treatment of domestic suppliers in government procurement.

Chinese officials complain about controls on "dual use" technology with possible military applications.

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