Trump says China trade talks 'back on track,' new tariffs on hold

By Roberta Rampton and Michael Martina

 

U.S. President Donald Trump meets with China's President Xi Jinping at the start of their bilateral meeting at the G20 leaders summit in Osaka, Japan, June 29, 2019. REUTERS/Kevin Lamarque

 

OSAKA (Reuters) - The United States and China agreed on Saturday to restart trade talks after President Donald Trump offered concessions including no new tariffs and an easing of restrictions on tech company Huawei in order to reduce tensions with Beijing.

 

China agreed to make unspecified new purchases of U.S. farm products and return to the negotiating table. No deadline was set for progress on a deal, and the world's two largest economies remain at odds over significant parts of an agreement.

 

The last major round of talks collapsed in May.

 

Financial markets, which have been rattled by the nearly year-long trade war, are likely to cheer the truce. Washington and Beijing have slapped tariffs on billions of dollars of each other's imports, stoking fears of a wider global trade war.

Those tariffs remain in place while negotiations resume.

 

"We're right back on track," Trump told reporters after an 80-minute meeting with Chinese President Xi Jinping at a summit of leaders of the Group of 20 (G20) major economies in Osaka, Japan.

 

"We're holding back on tariffs and they're going to buy farm products," Trump said, without giving details about the purchases.

 

Trump tweeted hours later that the meeting with Xi went "far better than expected."

 

"The quality of the transaction is far more important to me than speed," he tweeted. "I am in no hurry, but things look very good!"

 

The U.S. president had threatened to slap new levies on roughly $300 billion of additional Chinese goods, including popular consumer products, if the meeting in Japan proved unsuccessful. Such a move would have extended existing tariffs to almost all Chinese imports into the United States.

 

In a lengthy statement on the two-way talks, China's foreign ministry quoted Xi as telling Trump he hoped the United States could treat Chinese companies fairly.

 

"China is sincere about continuing negotiations with the United States ... but negotiations should be equal and show mutual respect," the foreign ministry quoted Xi as saying.

 

Trump offered an olive branch to Xi on Huawei Technologies Co [HWT.UL], the world's biggest telecom network gear maker. The Trump administration has said the Chinese firm is too close to China's government and poses a national security risk, and has lobbied U.S. allies to keep Huawei out of next-generation 5G telecommunications infrastructure.

 

 

Trump's Commerce Department has put Huawei on its "entity list," effectively banning the company from buying parts and components from U.S. companies without U.S. government approval.

 

But Trump said on Saturday he did not think that was fair to U.S. suppliers, who were upset by the move. "We're allowing that, because that wasn't national security," he said.

 

CHEERS FROM CHIP MAKERS

 

Trump said the U.S. Commerce Department would study in the next few days whether to take Huawei off the list of firms banned from buying components and technology from U.S. companies without government approval.

 

China welcomed the step.

 

"If the U.S. does what it says, then of course, we welcome it," said Wang Xiaolong, the Chinese foreign ministry's envoy for G20 affairs.

 

U.S. microchip makers also applauded the move.

 

"We are encouraged the talks are restarting and additional tariffs are on hold and we look forward to getting more detail on the president's remarks on Huawei," John Neuffer, president of the U.S. Semiconductor Association, said in a statement.

 

Republican U.S. Senator Marco Rubio, however, tweeted that any agreement to reverse the recent U.S. action against Huawei would be a "catastrophic mistake" and that legislation would be needed to put the restrictions back in place if that turned out to be the case.

 

Last month, Rubio and Democratic U.S. Senator Mark Warner urged Trump to not use Huawei as a bargaining chip for trade negotiations.

 

Huawei has come under mounting scrutiny for over a year, led by U.S. allegations that "back doors" in its routers, switches and other gear could allow China to spy on U.S. communications.

 

The company has denied its products pose a security threat. It declined to comment on the developments on Saturday.

 

The problems at Huawei have filtered across to the broader chip industry, with Broadcom Inc <AVGO.O> warning of a broad slowdown in demand and cutting its revenue forecast.

 

Trump said he and Xi did not discuss the extradition proceedings against Meng Wanzhou, Huawei's chief financial officer, who was arrested in Canada in December on charges alleging she misled global banks about Huawei's relationship with a company in Iran.

 

RELIEF AND SCEPTICISM

 

Scores of Asia specialists, including former U.S. diplomats and military officers, urged Trump to rethink policies that "treat China as an enemy," warning that approach could hurt U.S. interests and the global economy, according to a draft open letter reviewed by Reuters on Saturday.

 

Investors, businesses and financial leaders have for months been warning that an intractable tit-for-tat tariff war between the United States and China could damage global supply chains and push the world economy over a cliff.

 

International Monetary Fund Managing Director Christine Lagarde on Saturday urged G20 policymakers to reduce tariffs and other obstacles to trade, warning that the global economy had hit a "rough patch" due to the trade conflict.

 

Although analysts cheered a resumption of talks between Washington and Beijing, some questioned whether the two sides would be able to build enough momentum to breach the divide and forge a lasting deal.

 

"Translating this truce into a durable easing of trade tensions is far from automatic ... especially as what's in play now extends well beyond economics to include delicate national security issues of both immediate- and longer-term nature," said Mohamed El-Erian, chief economic adviser at Allianz.

 

The United States says China has been stealing American intellectual property for years, forces U.S. firms to share trade secrets as a condition for doing business in China, and subsidizes state-owned firms to dominate industries.

 

China has said the United States is making unreasonable demands and must also make concessions.

 

The negotiations hit an impasse in May after Washington accused Beijing of reneging on reform pledges made during months of talks. Trump raised tariffs to 25% from 10% on $200 billion of Chinese goods, and China retaliated by raising levies on a list of U.S. imports.

 

(Reporting by Roberta Rampton, Michael Martina and Chris Gallagher in Osaka; Additional reporting by Koh Gui Qing in New York, Ben Blanchard in Beijing and Leika Kihara in Osaka and Jennifer Ablan in New York; Writing by Linda Sieg, Malcolm Foster, Jeff Mason and Paul Simao; Editing by Clarence Fernandez, Himani Sarkar)

 

-- © Copyright Reuters 2019-06-30

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Looks like Trump has just find out that shooting yourself in the foot actually hurts ????

 

Tariffs are a double edged sword- whilst being bad news for Americans they are good news for America- increasing the chance Trump will not be re-elected

Once again, the rubber backboned con man is clueless on trade talks. He is now spinning a tale on how "no deal" is actually winning. China is walking all over him.

 

Trump tries to persuade supporters that no deal on China is a win

Trump is a  bullying, coercing, intimidating man. But this time he is coming around on Chinese terms. This illegitimate president's bullying days are coming to an end.

I just knew he would pull a rabbit out of his hat. Thanks Donald, I'll be sitting back with a cohiba and cool glass of the finest Kava to watch the S&P open on Monday. Hooray for Donald Trump and his art of the deal. Come to think of it, it's hardly a surprise that an experienced businessman can run the country and economy properly - unlike a career politician that by nature is inexperienced at real life matters.

 

9 minutes ago, TopDeadSenter said:

I just knew he would pull a rabbit out of his hat. Thanks Donald, I'll be sitting back with a cohiba and cool glass of the finest Kava to watch the S&P open on Monday. Hooray for Donald Trump and his art of the deal. Come to think of it, it's hardly a surprise that an experienced businessman can run the country and economy properly - unlike a career politician that by nature is inexperienced at real life matters.

 

The only party that made concessions is Trump. Xi actually made that a precondition for resuming the talks.

17 minutes ago, TopDeadSenter said:

I just knew he would pull a rabbit out of his hat. Thanks Donald, I'll be sitting back with a cohiba and cool glass of the finest Kava to watch the S&P open on Monday. Hooray for Donald Trump and his art of the deal. Come to think of it, it's hardly a surprise that an experienced businessman can run the country and economy properly - unlike a career politician that by nature is inexperienced at real life matters.

 

He’s a funney troll lol Donald just got his hat handed to him meanwhile we continue to pay higher prices to cover Donald’s skrew ups maybe it wasent such a good idea to shank our allies before you started this trade war of yours eh

28 minutes ago, TopDeadSenter said:

I just knew he would pull a rabbit out of his hat.

OMG, I'm 71 years old and I've finally just learned what pulling a rabbit out of his hat means !!!!!!!!

 

Wait a minute. Is that really what I means? Something doesn't seem to sound quite right.

3 minutes ago, neeray said:

OMG, I'm 71 years old and I've finally just learned what pulling a rabbit out of his hat means !!!!!!!!

 

Wait a minute. Is that really what I means? Something doesn't seem to sound quite right.

 

Too much Rocky and Bullwinkle.

 

This time for sure!

 

Umm....Nope!

 

56 minutes ago, rooster59 said:

President Donald Trump offered concessions including no new tariffs and an easing of restrictions

Except for about 5 Trump supporters on this forum, the rest of us all could have guessed the above would happen (but we're all too modest to say "I knew it").

 

From my observation, Trump is famous for boxing himself into a corner and then using the tactic of "delay" to give him some wiggle room. And he certainly "wiggled" out of this global-economy-destroyer! Smart move Donny.

 

Nice to see that the more intelligent and experienced Xi was able to stick handle him.

 

Xi looks like he's about to burst out laughing at Trump's orange makeup.

Mulvaney looks like he's desperately trying to stiffle a cough.

The Chinese must be wondering if Bolton smuggled a fall armyworm into China under his moustache.

Ivanka? What the hell is she doing at a trade negotiation? LOL. "The best people, the best people."

Navarro must be thinking, 'Could I be any more marginalized at this photo op?'

 

If I know anything about reading Chinese faces, the Chinese negotiating team despises everyone sitting across the table from them, as do I.

 

Trump had to concede on no new tariffs and backtrack on Huawei just to get Xi to agree to even continue talks? Trump's desperate and Xi knows it. Powell's not going to cut rates next month. He's effectively going to tell Trump 'if you're not satisfied with the economy, resolve the trade dispute with China. The Fed ain't your biatch, biatch.'

 

1 hour ago, Silurian said:

Once again, the rubber backboned con man is clueless on trade talks. He is now spinning a tale on how "no deal" is actually winning. China is walking all over him.

 

Trump tries to persuade supporters that no deal on China is a win

I was about to post that Trump will claim a fake victory, as usual. He was quicker than I thought. ????

You know there's going to be a war when you see the assembled group of leaders together and think which one of these miserable charlatans should really be there????  

5 minutes ago, Gecko123 said:

If I know anything about reading Chinese faces, the Chinese negotiating team despises everyone sitting across the table from them, as do I.

You caused me to study that photo op a bit harder Gecko123. I'd say your "read" is spot on.

And the "Barbie" does look somewhat out of place amidst all that testosterone.

Trump seems to be doing well , making friends with Russia and China and many others .

Rather than just going with the flow and watching his tenancy float by  , he is getting things done .

10 minutes ago, sanemax said:

Trump seems to be doing well , making friends with Russia and China and many others .

Rather than just going with the flow and watching his tenancy float by  , he is getting things done .

Should the US be "making friends" with Russia" And as for "making friends" with the Chinese, on what planet exactly?

Trump: I'm putting tariffs on all your goods!

Chinese stop buying US farm products.

Trump: OK, if you buy our farm products again, I won't put tariffs on your goods, and I'll give Huawei a pardon as well.

Trump supporters: MAGA!

4 minutes ago, bristolboy said:

Should the US be "making friends" with Russia" And as for "making friends" with the Chinese, on what planet exactly?

IMO , The whole World needs to get on friendly terms .

Put all the differences behind us and end any hostilities  

It's like we live in an alternative universe where Biff Tannen is president. Imagine that world where Biff tells you Huawei is a national security threat and coerces allies into not doing business with them. Then, Biff, comes back and undercuts his own national security agency and his allies by restoring Huawei's access to American technology in return for a bag of soybeans. That couldn't happen in the real world, could it?  Only in Biff's world, please.

 

An alternative world might exist out there where Biff folds on trade one week, after folding on deportations the week before, after folding on the budget, after folding on some type of wall or something. It's a good thing Biff world is nothing like the real world, Whew!

1 hour ago, TopDeadSenter said:

I just knew he would pull a rabbit out of his hat.

And that rabbit is waving a white flag.

9 minutes ago, sanemax said:

IMO , The whole World needs to get on friendly terms .

Put all the differences behind us and end any hostilities  

No matter how inimical the behavior of those countries is to the interests of the USA?

1 hour ago, sanemax said:

Trump seems to be doing well , making friends with Russia and China and many others .

Rather than just going with the flow and watching his tenancy float by  , he is getting things done .

So true but only after stabbing our friends in the guts

3 hours ago, rooster59 said:

The United States and China agreed on Saturday to restart trade talks after President Donald Trump offered concessions including no new tariffs and an easing of restrictions on tech company Huawei in order to reduce tensions with Beijing.

 Well done trump, there is no shame in backing down when your scatter blast use of tariffs clearly is failing. 

 

Ignore anyone one who says otherwise.

 

You did not choke...

48 minutes ago, car720 said:

Anyone who has ever lived in China knows that their negotiation skills are completely rudimentary...

Yes, one thing Chinese business people the world over are know for is their poor negotiation skills ????????????. GMAB!!

The 10,134 lie since he took office. There is no change from 2 months ago! Two days ago he was spruiking ( great negotiator) that the Chinese will hand down their response and it will be good, it will be good outcome for USA, we will win.  The liar needs to understand; re instate Huawei or the deal is off.

7 minutes ago, legend49 said:

The 10,134 lie since he took office. There is no change from 2 months ago! Two days ago he was spruiking ( great negotiator) that the Chinese will hand down their response and it will be good, it will be good outcome for USA, we will win.  The liar needs to understand; re instate Huawei or the deal is off.

Trump did state that the talks are back on with China .

Are you claiming that Trump is lying and that the talks with China are not actually back on again  ?

If not , what are you clamming thaT Trump is lying about ?

1 hour ago, mikebike said:

Yes, one thing Chinese business people the world over are know for is their poor negotiation skills ????????????. GMAB!!

He said rudimentary, not poor. As in 'you do A, and we'll do B, then C will follow.'

 

He's right on the money, they never over-complicate deals. The reason (from the Chinese point of view) that the talks broke down in May, was that the American side wanted their terms put into Chinese law, rather than included contract to contract with top level guarantees, thus giving American companies the ability to sue the Chinese, in China, under Chinese law.

 

I can't think of any country worldwide that would even give that a second thought. It was Mnuchins stroke of genius.

Trump said that trade wars were easy to win , yet he couldn't manage it !

32 minutes ago, Traubert said:

He said rudimentary, not poor. As in 'you do A, and we'll do B, then C will follow.'

Yes, very "rudimentary", like the new silk road deals they have negotiated. Nothing complicated there... ????????????