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Trade Talks Update: Is a Peace Deal in the Works for US and China?
By admin January 16, 2019

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The trade war between the US and China has been ongoing throughout 2018. Its beginnings can be traced back to March when the US proposed tariffs in reaction to China’s “unfair trade practices”, and China responded by revealing their own tariffs on US goods. The back and forth of various tariffs continued to increase until the announcement was made in October that the two presidents would meet at the G-20 summit later that year.

Recently, in what appears to be a move toward improving relations between the countries, China has reduced tariffs on American cars and has begun to import American soybeans once more. The New York Times reports that China is even offering to allow foreign investors into “more industries than ever before,” signaling the possibility for an amicable ending to the 2018 dispute. In their December meeting, when President Xi and President Trump agreed on a truce, a 90-day timeframe was set for a trade deal to be reached. Now, with mid-level negotiations officially over, the path has been paved for higher-level talks to begin, potentially taking place later this month.

Despite this, US negotiators are taking a more reserved stance with their response. American officials have complained that China has previously bailed on political commitments, and although Chinese officials deny such claims, they have still influenced the US position, rendering officials cautious of “nebulous” promises. A surprise visit from North Korean leader Kim Jong-Un to Beijing on Tuesday may also play into future negotiations. Steve Tsang, director of the SOAS China Institute in London, refers to this as a “coincidence of interest,” pointing out that the visit can be understood as a message from Beijing to Washington, and a reminder of China’s significant leverage when it comes to North Korea. As the US is currently pushing for North Korea to abandon their nuclear missile development, this visit generated much speculation as to its potential influence on subsequent talks.

Yet, despite a definite deal not being agreed upon, the length of time dedicated to these negotiations indicates a level of determination on both sides for an agreement to be reached. A spokesman for China’s foreign ministry is quoted by the BBC as saying that: “If [there is] a good outcome, it doesn’t just benefit the US and China, but it is also good news for the world economy,” and recent communication from the US administration mirrors this positive approach. This came in the form of an official statement, released by The Office of the US Trade Representative (USTR), addressing commitments that China has made to buying various US products – including energy, food, and agricultural products – to lessen the current trade deficit. The statement also notes that representatives for each country have “discussed ways to achieve fairness, reciprocity and balance” in their trade relations, as well as the need for “ongoing verification and effective enforcement” once a deal has been agreed upon.

Officials have been given until March 1st, 2019 to reach an accord on various “needed structural changes” laid out in the USTR statement with regards to the Chinese economy. These include resolving issues of cyber theft and the “use of trade secrets for commercial purposes,” both of which are integral for restoring congenial relations between the US and China. So far, statements from both sides remain positive and global stocks continue to rise as the two countries make gradual progress on the issue. Perhaps then, this is indicative of a peace deal on the horizon, that will allow the US and China to, once and for all, put their trade dispute to rest.

 

For more information:

China Offers Trump a Trade Peace Deal. It May Not Be Enough.

US ‘plans next steps’ after trade talks with China end – as it happened

USTR Statement

BBC: China-US Relations

North Korean Leader’s Beijing Visit Underscores China’s Pivotal Role

US Pushes China on Promises After ‘In-Depth’ Trade Meetings


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