U.S.' Mnuchin, Lighthizer to hold talks next week in China

U.S.' Mnuchin, Lighthizer to hold talks next week in China

U.S.' Mnuchin, Lighthizer to hold talks next week in China

US President Donald Trump said on 31 January that US trade talks with China were going well, adding that a final deal would not be made until his meeting with Chinese leader Xi Jinping, slated for the "near future". "But it must include real, structural change to end unfair trade practices, reduce our chronic trade deficit and protect American jobs".

Washington and Beijing have slapped punishing tariffs on more than US$360 billion (S$486 billion) in two-way trade, which has weighed on the two countries' manufacturing sectors and sent jitters through global markets.

"A real deal still has to take shape", said Scott Kennedy, a China expert at the Center for Strategic and International Studies."Everything between now and when the US delegation goes to Beijing is 100 percent noise". "China bilateral trade will decline and replaced by trade originating in other countries", she said.

The talks have centred on addressing USA demands for deep structural changes to China's economic and trade policies, including new protections for US intellectual property, ending forced technology transfers, reining in China's subsidies for state industries and increasing Chinese purchases of USA farm, energy and manufactured products.

The United States Reciprocal Trade Act, if signed into law, could have consequences on bilateral trade with India.

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The Reciprocal Trade Act would give him authority to levy tariffs equal to those of a foreign country on a particular product if that country's tariffs are determined to be significantly lower than those charged by the United States.

Trump has been alleging that many countries all over the world have taken advantage of the US.

It would also allow Trump to take into account non-tariff barriers when determining such tariffs. "Therefore, we recently imposed tariffs on 250 billion dollars of Chinese goods and now our treasury is receiving billions and billions of dollars". It's still 50 per cent vs 2.4 per cent (on imported motorcycles to the US). Yet as he approaches a potential deal, some of the very hawks who have cheered on the president's trade war already fear he may end up falling short.

Dow Jones earlier reported that the talks next week would be led by U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, citing an unidentified senior administration official. What comes of any deal will depend on the political will of future presidents to use the same tariffs Trump has employed to enforce it, the official said. They are reluctant to make big investment decisions that could become unprofitable if the tariffs are reversed.

Trump is likely to hail his own trade fight with China in his State of the Union address on Tuesday. The business community is rallying behind the bill.

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