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'U.S., China close in on trade deal,' says report

Posted March. 05, 2019 07:35,   

Updated March. 05, 2019 07:35


China and the United States are reportedly ironing out their differences enough to clinch a trade deal through a potential summit meeting.

“China and the U.S. are in the final stage of completing a trade deal, with Beijing offering to lower tariffs on American farm, chemical, auto, and other products, and Washington considering removing most, if not all, sanctions levied against Chinese products since last year," the Wall Street Journal reported Sunday citing sources.

According to the report, China has proposed a deal where it advances the schedule to cut tariffs on imported vehicles, which currently stands at 15 percent, and ease restrictions currently imposed on foreign companies willing to invest in Chinese venture automakers. Under the deal, Sinopec, a Chinese state-run oil company, will buy natural gas worth 18 billion dollars from Cheniere Energy, a Houston-based energy company.

Experts say that if the talks make smooth progress, a summit meeting between Washington and Beijing could be held at U.S. President Donald Trump’s private Mar-a-Lago resort in Florida on March 27, right after Chinese President Xi Jinping finishes his visits to Italy and France.

There remain variables, however, such as differences in opinion and public criticism over a set of structural reforms including China’s subsidy policy for state-run companies and protection of intellectual property. The hawkish lawmakers of Washington are discontent that even if China fails to keep their promises, it enjoys an opportunity for negotiation before being slapped with tariffs immediately.

Of the 100 or so pages of trade agreement documents that the U.S. and China are currently discussing over, roughly 30 of them are dedicated to the clauses on intellectual property protection. Beijing is concerned about the public opposition, which claims the deal is nothing short of “the unequal treaties used to be imposed by the Western powers in the 19th century.” In fact, the current plan for the summit, where Xi stops by the U.S. after his Europe tour, is designed to eschew a potential public criticism that the Chinese president’s direct trip to Washington is wasted on merely making concessions.

Yong Park parky@donga.com