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US sees no material impact from virus on US-China trade deal

Riyadh

US TREASURY Secretary Steven Mnuchin told Reuters he does not expect the novel coronavirus outbreak to have a material impact on the Phase 1 US-China trade deal, although that could change as more data becomes available in coming weeks.

Finance officials from the world's 20 largest economies said on Sunday they would keep a close watch on the fast-spreading outbreak, but stopped short of identifying it as downside risk to the global economy.

Fears of a pandemic mounted even as they met in the Saudi capital of Riyadh, with sharp rises in new cases reported in Iran, Italy and South Korea.

Mr Mnuchin, in an interview with Reuters late on Sunday, cautioned against jumping to conclusions about the impact of what he called a "human tragedy" on the global economy, or on companies' supply chain decisions, saying it was simply too soon to know.

China was focused on the virus for now, he said, but Washington still expected Beijing to live up to its commitments to buy more US products and services under the trade deal.

"I don't expect that this will have any ramifications on Phase 1. Based on everything that we know, and where the virus is now, I don't expect that it's going to be material," he said.

"Obviously that could change as the situation develops. Within the next few more weeks, we'll all have a better assessment as there's more data around the rate of the virus spreading."

Mr Mnuchin acknowledged the outbreak could also delay the start of negotiations on deepening the trade deal with Beijing and reaching a Phase 2 agreement, but said he was not worried about that at this point.

"If we get the right deal before the election, that's great. If we get the right deal after the election, that's great. We don't feel any pressure one way or another," he said, referring to the Nov 3 US presidential election, in which President Donald Trump is seeking re-election. REUTERS