“China and the US have made substantial progress in many aspects, and laid an important foundation for a phase one agreement,” Vice Premier Liu He said at a technology conference in Nanchang, Jiangxi, yesterday. He reiterated that China is “willing to work in concert with the US to address each other’s core concerns on the basis of equality and mutual respect.”
The comments come as the US and China work towards getting some sort of agreement ready for presidents Donald Trump and Xi Jinping to sign at the Asia-Pacific Economic Cooperation summit next month in Chile. The US has said China will buy as much as $50bn in US agricultural goods in exchange for the suspension of additional tariffs, though Bloomberg has reported that the Chinese want more talks and would need existing tariffs rolled back in order to reach that amount of imports.
The “phase one” deal described by Washington may not address many of the larger issues that initiated the trade war which has dragged on for more than a year, such as forced technology transfers and industrial subsidies. The White House is also looking at rolling out a previously agreed currency pact with China, people familiar said earlier. The agreement would be similar to commitments China has already made in accordance with International Monetary Fund standards, they said.
Liu did not address any specifics in his speech, though he reiterated that China would boost intellectual property protection, especially for small and medium enterprises.
US Treasury Secretary Steven Mnuchin said that lower-level talks would take place by phone this week. Chinese officials are working on the text of an agreement on trade in close contact with US negotiators, and have begun discussions on the next stage, Ministry of Commerce spokesman Gao Feng said on Thursday.
China’s economic growth slowed further to 6% in the third quarter, according to data released on Friday, increasing pressure on Beijing to put an end to the trade conflict. With a drop-off in exports to the US expected to continue as long as tariffs remain, the economy is likely to keep struggling as deflationary pressures hit company profits.
China is targeting 6% to 6.5% gross domestic product growth this year. Liu said the fundamentals of China’s economy remain unchanged, even as it goes through a significant re-balancing, and the nation is “confident” of reaching its economic targets.
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