Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the US even as the two sides get close to signing a “phase one” agreement.
In private conversations with visitors to Beijing and other interlocutors in recent weeks, Chinese officials have said they would not budge on the thorniest issues, people familiar with the matter said.
They remain concerned about US President Donald Trump’s impulsive nature and the risk he might back out of even the limited deal both sides say they want to sign in the coming weeks.
Chinese policymakers gathered in Beijing this week for a key political meeting that ended on Thursday.
In meetings ahead of that plenum, some officials relayed low expectations that future negotiations could result in anything meaningful — unless the US is willing to roll back more of the tariffs.
In some cases, they urged US visitors to carry that very message back to Washington, the people said.
Chilean President Sebastian Pinera threw up another hurdle when he announced on Wednesday that Santiago had canceled the APEC summit on Nov. 16 and 17 — where Trump and Chinese President Xi Jinping (習近平) hoped to meet — because of social unrest in the country.
In a tweet on Thursday, Trump said the search is ongoing for a new location for Xi and him to sign the deal, which he said would be “about 60 percent of total deal.”
That first step, according to the Trump administration, is meant to lead to a more comprehensive agreement involving more substantial economic reforms than those contained in the proposed initial phase.
However, Chinese officials are skeptical, saying that would require the US to withdraw tariffs in place on about US$360 billion in imports from China — something many do not see Trump being ready to do.
The people familiar with China’s position said the tariffs do not all have to be removed immediately, but they must be part of the next stage.
China also wants Trump to cancel a new wave of import taxes due to take effect on Dec. 15 on US consumer favorites, such as smartphones and toys as part of the phase one deal, the people said.
Beijing is open and willing to continue talks after an initial phase, but both sides recognize that it will be very difficult to reach an agreement on the deep structural reforms the US is pushing for, one Chinese official familiar with the talks said.
The first phase, which negotiators are still trying to nail down, is expected to include a resumption of Chinese purchases of US farm goods and other products such as aircraft.
It is also expected to include Chinese commitments to protect US intellectual property and an agreement by both sides not to manipulate their currencies.
In return, Trump agreed not to go ahead with an Oct. 15 tariff increase and aides have raised the possibility of canceling the Dec. 15 levies.
Yet the move to a phased approach reflects China’s resistance to many US demands and a concession by the White House to abandon its stance that nothing is agreed until all the thorny issues are resolved.
“Even if they do get a phase one, a phase two is going to be substantially more difficult because all the really difficult issues are being deferred,” said Eswar Prasad, who once led the IMF’s China team and is now at Cornell University.
The Chinese Ministry of Commerce did not immediately respond to a fax seeking comment on the trade talks, but a former official said there could still be a long road ahead.
“If the US demands are too much, such as insisting on the so-called structural changes that will alter China’s economic model, then the complete deal can’t be finished during Trump’s first term,” said Zhou Xiaoming, a former ministry official.
“Other than that, China wants to have a deal as quickly as possible” though a complete deal would include the removal of all punitive tariffs, he said.
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