New Framework Marks Progress in US-China Trade Talks
Senior US and Chinese officials have reached an agreement on a framework to advance stalled trade negotiations, as reported by Chinese state media on June 11. This announcement follows two days of discussions held in London, which concluded late Tuesday. The talks were essential as simmering disputes had put a fragile truce, agreed upon in Geneva the previous month, at risk. Just last week, a phone conversation between President Donald Trump and Chinese President Xi Jinping aimed to ease tensions between the two economic giants.
Li Chenggang, vice minister of commerce and China's international trade representative, stated that both parties have reached a consensus in principle on implementing agreements made between the two leaders and during the Geneva conferences. This was confirmed by the official Xinhua News Agency. Li, along with Wang Wentao, China's commerce minister, participated in the negotiations led by Vice Premier He Lifeng. The discussions with US Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent, and Trade Representative Jamieson Greer took place at the historic Lancaster House, located near Buckingham Palace.
Wendy Cutler, a former US trade negotiator, expressed concern that ongoing disputes had consumed 30 of the 90 days allotted for resolving the significant issues at hand. In Geneva, the US and China agreed to a 90-day suspension of most tariffs imposed during their escalating trade war, which has raised recession fears on both sides. Cutler, now vice president at the Asia Society Policy Institute, noted that the loss of crucial time in restoring agreements reached in Geneva places increased pressure on both parties.
As of now, only 60 days remain to address critical concerns, which include unfair trade practices, excess capacity, transshipment issues, and the trafficking of fentanyl. In the aftermath of the Geneva talks, tensions have escalated with exchanges of harsh rhetoric over advanced semiconductors pivotal for artificial intelligence, visa regulations affecting Chinese students in the US, and rare earth minerals essential to various industries.
China, as the world's leading producer of rare earths, has indicated a potential easing of export restrictions placed on these elements in April, which had alarmed global automakers. Conversely, China is pressing for the US to lift restrictions on its access to technology necessary for the production of advanced semiconductors. Cutler remarked that negotiating US export controls would be unprecedented, noting that this issue has been a source of contention raised by China for nearly two decades. By contemplating this negotiation, the US risks opening the door for China to insist on including this topic in future discussions.
President Trump has voiced the intention to integrate China, the world’s leading manufacturer, into the US market. During a statement at the White House, he emphasized the importance of opening up China to US products, stating, "If we don't open up China maybe we won't do anything. But we want to open up China."
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