From January 7-9, 2019, trade representatives from the governments of China and the United States met in Beijing for negotiations that could resolve the trade war that has been going on for more than half a year.
The talks extended a third day beyond the two originally scheduled, and ended with the U.S. Trade Representative’s (USTR) office saying that “ways to achieve fairness, reciprocity, and balance in trade relations” had been discussed, according to Reuters.
In December, U.S. and Chinese presidents Donald Trump and Xi Jinping negotiated a 90-day truce to the trade war, in which tariffs imposed by Washington have heavily catalyzed existing crises in the Chinese economy. Countertariffs by the Chinese communist authorities have hurt some U.S. exporters as well, particularly in tech and agriculture.
Following the December meeting, in which Xi reportedly agreed to implement reforms to bring China more in line with fair trade practices, U.S. officials said the Chinese government “had made an additional US$1.2 trillion in trade commitments,” according to Reuters.
China has made several large purchases of soybeans amid the recent negotiations.
Pressure is on for Xi to negotiate a deal that is acceptable to Washington, as Trump has said that he will raise existing tariffs on US$200 billion worth of Chinese exports if a deal cannot be signed by March 2.
High on the agenda was the issue of intellectual property rights, violations of which cost U.S. companies hundreds of billions of dollars in losses annually. Most of the violations originate with Chinese companies and government actors.
The USTR said that the representatives discussed intellectual property protections, including the need for “complete implementation subject to ongoing verification and effective enforcement” to be included if an agreement were to be reached.
Confidence for a deal
On January 9, White House press secretary Sarah Huckabee Sanders told Fox Business Network: “We’re hopeful that we can make a deal with China. We expect something will come out of this.”
As the talks came to an end, Trump posted a tweet saying: “Talks with China are going very well!”
The Chinese authorities have said that trade talks were “very serious,” according to spokesman Lu Kang, and that while Beijing wanted to end the trade war, it would not make any “unreasonable concessions,” the state-run China Daily reported.
Ted McKinney, the U.S. undersecretary for trade and foreign agricultural affairs, said in Beijing that he thought the talks “went just fine,” and came out favorably for the American side.
Notably, as the talks were underway, North Korean leader Kim Jong-un was present in China for his fourth summit with Xi Jinping. Kim had arrived in Beijing at the latter’s request, according to state media.
“We believe that Xi Jinping summoned Kim Jong Un to Beijing to signal cooperation with the U.S. on the denuclearization of North Korea, and hence bolster the odds of successful Sino-U.S. trade talks,” says an article by SinoInsider, a consultancy company that specializes in analysis of Chinese politics.
The article noted that while China and North Korea, which are authoritarian communist states, had “a long history of being untrustworthy” in their negotiations, “both sides are currently experiencing great pressure from the U.S., and have sufficient incentive to try to be genuine to win America’s trust and see progress in their respective negotiations.”
SinoInsider further believes that communist leaders like Xi and Kim cannot publicly express willingness to make concessions lest they lose face and endanger their political positions. However, they can and do issue signals to display their intent while retaining plausible deniability.