US-China trade talks see signs of progress

The trade talks between the United States (US) and China will continue for an unscheduled third day, US officials said on Tuesday night.

It seems US’ talks with China are “going very well”, according to the recent tweet from US President Donald Trump which surfaced on his Twitter feed as talks ended on Tuesday evening in Beijing, China. US officials cited by Reuters said progress has been made on talks revolving around the purchases of US farm and energy commodities, as well as increased access to China’s markets.

US’ Department of Energy’s assistant secretary for Fossil Energy Steven Winberg told reporters in Beijing that the talks had gone well and confirmed that the session will continue tomorrow, but did not provide additional details.

On Monday, US commerce secretary Wilber Ross had told reporters that Beijing and Washington could reach a trade deal the US “can live with”, sparking a rally in equities markets as traders were optimistic that the ongoing trade dispute may soon come to an end.

90-day deadline due on March 2nd

This week’s unscheduled talks marks the first face-to-face meet up involving mid-level officials since the 90-day trade war truce in early December.

In the breakthrough talks last month which was held on the side lines of the G20 summit, Mr Trump had agreed to postpone the plan to raise tariffs on US$200 billion worth of Chinese goods from 10% to 25%. Mr Xi meanwhile, agreed to an undisclosed amount of increase in their purchases of US industrial, energy and agricultural products.

The momentary truce had helped calm the jitters felt in the financial markets and local businesses on both ends. If both parties do not reach a deal by March 2, the US will proceed with raising tariffs to 25% from 10% on US$200 billion worth of Chinese imports.

The Chinese are keeping to their word with the truce. On Monday, Chinese importers made their third largest soy bean purchase from the US in a month.

More than just soybeans

However, the trade talks are not aimed at just short-term temporal relief, but structural changes on how trade between both nations are dealt with, and how businesses partner up.

Beyond just superficial imports on goods, the US wants China to tackle on issues involving the alleged Chinese theft of US intellectual property, ownership challenges for American companies in China, and tariffs and non-tariff barriers.

Observers have noted that the difficult issue the US has with China is on the limitations on the access foreign firms in China have with its consumers, which makes it tough for foreign companies to invest into the country. Without a joint venture with a local firm, foreign firms are unable to sell their goods to Chinese customers.

China’s state newspaper China Daily said in an editorial piece on Wednesday that for the agreement between the US and China to pull through, both parties must “give and take”. China is keen to end the trade dispute, but will not be making “unreasonable concessions”, it added.