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US-China talks a stalemate; new round of tariffs might come as soon as early September
THE trade war between the US and China is primed to escalate after their governments failed to make progress in two days of talks.
The sides met with low expectations for this week's meetings and no further talks had been scheduled, a person familiar with the discussions said. The person also said Chinese officials raised the possibility that no further negotiations could happen until after November's midterm elections in the US.
The lack of progress and the looming prospect of further tariffs from both sides add to the uncertainty for businesses. A new round of tariffs could come as soon as early September, but there is no guarantee that will be the last, or that there won't be other measures.
"Now, it seems quite likely that the US will impose tariffs on the US$200 billion in imports from China, which will trigger a bigger round of shooting," said Zhou Xiaoming, a former commerce ministry official and diplomat. "It is impossible for China to drop the Made In China 2025 and its industrial policies as a compromise. But there is haggling room in IP protection and market access issues."
In a statement, the White House said the countries "exchanged views on how to achieve fairness, balance and reciprocity in the economic relationship, including by addressing structural issues in China" identified by the US in an investigation into Chinese IP practices. The two nations had "constructive, candid" communication, and will keep in touch about the next steps, the China commerce ministry said in a statement released on Friday.
The conclusion of the talks came just hours after Beijing and Washington rolled out their latest round of tit-for-tat tariffs on Thursday.
The Trump administration is preparing a far larger tranche of tariffs covering some 6,000 products from China with an annual import value of US$200 billion. That move and the anticipated retaliation from the Chinese would mark the largest escalation so far and start to hit American consumers more directly. The US could impose the duties after a comment period ends Sept 6.
The two days of talks led by US Treasury Undersecretary for International Affairs David Malpass and Vice Commerce Minister Wang Shouwen marked the first major interaction between the two sides since June. According to the person familiar with the discussions, the US Treasury presented a revised version of the list of demands presented by the Trump administration when the two sides had their first high-level meetings in May. BLOOMBERG