Mixed messages from US over China trade deal

Legislation | 16 January 2019

US President Donald Trump says he hopes a trade deal with China will be forthcoming, but analysts aren't so sure.


There were mixed messages from the US this week after representatives met with Chinese officials to discuss moving towards a potential new trade deal between the two nations.

Speaking ahead of a trip to New Orleans, President Donald Trump told reporters he believes China is feeling the impact of tariffs on its products and so is keen to come to an agreement.

"We're doing very well with China. They're having a hard time with their economy because of the tariffs. We are getting things that before I became president, you would have had no chance of getting. I think we're going to be able to do a deal with China," he commented.

However, analysts are not quite so bullish, with Harvard University economist Martin Feldstein telling the Wall Street Journal he believes Mr Trump is nervous about what the trade conflict with China is doing to the stock market.

Indeed, many believe the two sides are far from making a deal, with leaders instead using the recent summit to make clear their respective positions.

The talks were originally scheduled for two days but stretched to three, which some saw as a sign of progress, but no preliminary deals have been unveiled so far.

Speaking in a conference call with reporters, US senator Chuck Grassley admitted he did not see any progress made on structural issues, but added that he is hopeful progress will soon be made.

Another meeting will now take place on January 30th 2019 with Chinese vice president Liu He, US trade representative Robert Lighthizer and treasury secretary Steven Mnuchin.

If no deal comes to fruition or no extension is made to the current 90-day truce on tariffs, Mr Trump's ten per cent tariffs on Chinese imports will rise to 25 per cent on March 2nd.

The news comes after an apparently fruitful meeting between the two nations at the G20 summit, following which Mr Trump claimed relations with China had taken a leap forward.