The US and China on Wednesday failed to agree on major new steps to reduce the US trade deficit with China, casting doubt over US President Donald Trump’s economic and security relations with Beijing.
The annual economic dialogue in Washington ended with canceled news conferences, no joint statement and no new announcements on US market access to China.
The two sides had a “frank exchange,” but failed to agree on most major bilateral trade and economic issues that were important to the US, a senior US official said on condition of anonymity because he was not authorized to speak publicly.
Photo: AFP
These included US demands for access to China’s financial services markets, reducing excess Chinese steel capacity, reductions in auto tariffs, cutting subsidies for state-owned enterprises, ending Chinese requirements for data localization and lifting ownership caps for foreign firms in China, the official said.
“China acknowledged our shared objective to reduce the trade deficit which both sides will work cooperatively to achieve,” US Secretary of the Treasury Steven Mnuchin and US Secretary of Commerce Wilbur Ross said in a brief statement, highlighting a rare point of consensus.
The Chinese embassy in Washington cast the talks in a positive light, saying in a statement that both sides had acknowledged “significant progress” on the 100-day talks and would work together to reduce the trade deficit.
“The two sides will expand areas of cooperation in services and increase trade in services; expand mutual investment; and create a more open, equitable, transparent and convenient investment environment,” the embassy said.
The session had been billed as a follow-up to Trump’s first meeting with Chinese President Xi Jinping (習近平) at Mar-A-Lago, Florida, in April, when Trump hailed Xi’s cooperation in curbing the threat from North Korea.
Trump said that this would lead to better trade terms for China.
The two leaders launched a 100-day economic plan that has produced some industry-specific announcements, including the resumption of US beef sales to China and a pledge to grant limited US access to some financial services.
However, there have been no new initiatives since and Trump has grown increasingly frustrated with China’s lack of pressure on North Korea. His administration has threatened new sanctions on small Chinese banks and other firms doing business with Pyongyang.
Ross and Mnuchin said the US position on the China trade relationship would be guided by “the principles of balance, fairness and reciprocity on matters of trade will continue to guide the American position so we can give American workers and businesses an opportunity to compete on a level playing field.”
China’s delegation leader, Vice Premier Wang Yang (汪洋), left the US Treasury building without speaking to reporters.
Wednesday’s deadlock was unsettling for US business groups that had hoped to put more cracks in Beijing’s market access barriers and obviate more aggressive measures from the White House that could destabilize trade ties.
“We are disappointed the Comprehensive Economic Dialogue ended at an apparent impasse. It is important for governments to take tangible steps to address long-standing issues and ensure the commercial relationship remains a source of stability in the overall relationship,” said Jacob Parker, vice president of China operations at the US-China Business Council.
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