11 July 2024

(AFP) US and Chinese trade negotiators will resume talks in Washington in early October, Beijing said Thursday, after new punitive tariffs raised fears of a breakdown in the protracted negotiations.

The world’s two biggest economies have been embroiled in a tense year-long trade war, which escalated further on September 1 when both sides implemented fresh levies.

The negotiations were supposed to have resumed this month but the Chinese commerce ministry said Vice Premier Liu He, Beijing’s pointman on trade, agreed to October talks in a phone call with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Thursday.

The officials agreed to “work together and take practical actions to create favourable conditions for consultations”, the ministry said in a statement.

It said the two sides would “maintain close communication” ahead of the talks.

The top officials last met in Shanghai in July for a round of trade talks, which were described as “constructive” but ended with no announcements.

US President Donald Trump announced afterwards he would increase tariffs on more than half-a-trillion dollars’ worth of imports in a new round of punitive measures, prompting Beijing to respond with fresh tariffs on US goods worth $75 billion.

– New tensions –

Tensions continued to mount over the summer, with Trump accusing Chinese negotiators of holding out for a better deal in hopes he will be voted out in next year’s presidential elections.

But at the recent G7 meeting of rich democracies in France, Trump spoke of new communications between US and Chinese negotiators — giving financial markets a brief boost — while China’s foreign ministry said it was unaware of such contacts.

This week China said it had lodged a complaint against the US with the World Trade Organization (WTO), one day after new tariffs came into force.

While the US-China negotiations began in earnest in January and seemed at first to make progress, they were abruptly called off in the spring by Trump.

They resumed in June at the highest levels in the margins of the G20 summit meeting in Osaka, Japan, when Trump met his Chinese counterpart Xi Jinping.

But in its complaint to the WTO, Beijing accused the new US tariffs of “seriously violating the consensus reached by the leaders of our two countries in Osaka”.

The new round of talks will be seen as a sign of optimism in a trade war that has weighed on the global economy and shaken diplomatic relations between the two global powers.