US and Chinese negotiators ended the first of two days of trade talks on Thursday, in an effort to avoid the escalation of a trade war between the two economic giants.
The tension between the US and China has heightened after the White House accused Beijing of watering down commitments to trade reform — a claim strongly rejected by China.
Although talks are expected to resume on Friday, the US was set to rack up tariffs on $200 billion of Chinese goods entering the United States.
Consumer products — including cell phones, computers, clothing and toys — are especially targeted by the tariff rate increase from 10 percent to 25 percent.
Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin talked for 90 minutes on Thursday. Officials did not speak to reporters as they left but, following the talks, Trump held a meeting with Lighthizer and Mnuchin.
Trump announced the tariff hike on Sunday, expressing frustration with the pace of the talks.
While the US president on Thursday said a trade deal was still possible — adding that he had received a “very beautiful” letter from Chinese President Xi Jinping — he repeated his warning.
“I am different than a lot of people,” Trump said. “I happen to think that tariffs, for our country, are very powerful.”
Read more: China records slowest growth rate in nearly 30 years
China’s Commerce Ministry has warned that Beijing will not “capitulate to any pressure” threatening retaliation over any increase in tariffs.
“The Chinese side has kept its promises and this has never changed,” a spokesman added, without specifying how China might retaliate.
Both sides had appeared to be coming closer to an agreement, but the possibility of an escalation in the dispute has rattled stock markets around the world.
Philip Wee, of the Singapore-based DBS Bank, warned in a report that a tariff hike and a breakdown in talks meant that “risks of a financial market collapse, extreme risk aversion, and sharp slowdown in global growth will spike.”
Washington has demanded significant reforms to the Chinese economy, such as subjecting state enterprises to market principles, a reduction of massive subsidies and curbing the alleged theft of US intellectual property.
rc/sms (AFP, AP, Reuters)
Each evening at 1830 UTC, DW’s editors send out a selection of the day’s hard news and quality feature journalism. You can sign up to receive it directly here.
Credit: Source link