TWO days of inconclusive US-China talks ended last Friday in Beijing amid signs that the Trump administration is demanding dramatic concessions that challenge core elements of China's economic system and its ambitions for future development.
China said "big difference" remained as a high-level US government delegation headed home, although it said consensus had been reached on some issues. China's official Xinhua News Agency reported that the two sides agreed to establish a "working mechanism" to maintain close communication on the issues discussed in the talks.
The agency acknowledged that there were major disagreements on some matters. It said they would continue discussions, without providing specifics for when they would start again. Neither side briefed the media, and the US delegation led by Treasury Secretary Steven Mnuchin departed Beijing in the evening, according to Bloomberg.
"A disagreement over trade practices that has built up over more than two decades will take much more than two days to resolve," said Shane Oliver, the head of investment strategy at AMP Capital Investors Ltd in Sydney. "A negotiated solution remains most likely but it will take time with a lot of posturing and near-death moments along the way."
Given China's equally uncompromising stance, it was unclear where the two sides had found common ground. US envoys are likely to have met stiff resistance, given their demands for fundamental revisions in how the Chinese leadership manages foreign trade and its domestic economy. The demands included a US$200 billion cut in the US trade deficit with China by 2020.
Chinese negotiators presented their own hard-line terms for a reshaped trade relationship, demanding the United States drop a complaint over China's licensing terms for foreign patent holders and immediately designate China a market economy, which would give it easier treatment under routine US trade enforcement actions, The Washington Post reported.
With the US team, including Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross and US Trade Representative Robert E Lighthizer, en route to Washington, the White House released a statement calling the talks "frank."
Sources:HKSG GROUP
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