Another tariff deadline imposed by the Trump administration is fast approaching, and a meeting between US President Donald Trump and his Chinese counterpart Xi Jinping next month at the Group of Twenty summit may be the last chance for a breakthrough.
The White House has said that the tariff rate already slapped on US$200 billion in Chinese goods will increase from 10% to 25% starting next year.
That has increased the stakes for trade talks between the world’s two largest economies, but reporting on Thursday suggests that the Trump administration won’t even come to the table until Beijing presents a firm offer of concessions.
The Wall Street Journal reported the predicament on Thursday, citing Chinese and US officials.
“If China wants [the G-20 session] to be a meaningful meeting, we need to do the groundwork,” a senior White House official was quoted as saying. “And if they don’t give us any information, it’s just hard to see how that becomes fruitful.”
The article recounted a lesson China learned from putting their cards on the table in the past. While negotiating to join the World Trade Organization, former Chinese premier Zhu Rongji offered generous concessions to the Clinton administration. They were rejected by the US, which then made the proposal public, prompting a backlash from critics back in China. The development made it difficult for the Chinese to even offer equivalent concessions, let alone go further.
Officials in Beijing are said to be fearful that Trump will make public any proposal, boxing China into a corner. Cui Tiankai, China’s ambassador in Washington, said the two sides would have to sit down and make offers in person.
Cui also noted that two previous agreements, tentatively agreed to by US Commerce Secretary Wilbur Ross, and then separately by Treasury Secretary Steven Mnuchin, were subsequently undercut by the president himself.
For industries that will be affected by the steep increase in tariffs should a deal fail to be reached, as well as their investors, the clock is ticking.