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China reiterates tariffs must be reduced for interim trade deal with US

China’s commerce ministry spokesman Gao Feng speaking to reporters in Beijing. (AFP photo)

China has once again warned the US that tariffs must be cut if Beijing and Washington are to reach an interim agreement on trade, amid growing uncertainty on when even a phase-one agreement can be reached.

“The Chinese side believes that if the two sides reach a phase one deal, tariffs should be lowered accordingly,” China’s commerce ministry spokesman Gao Feng told reporters on Thursday, adding that both sides were maintaining close communication.

On November 7, Gao said China and the United States must simultaneously cancel some existing tariffs on each other’s goods for both sides to reach a phase one trade deal, but how much tariffs should be canceled could be negotiated.

Completion of a phase one deal between the world’s two biggest economies had been initially expected in November.

However, trade negotiators from both sides have failed to break a deadlock over “core issues of concern,” with rising bilateral tensions over geopolitical issues such as the anti-government protests in Hong Kong.

Already strained relations between China and the United States were further muddied on Wednesday after the US Congress overwhelmingly approved a bill targeting Beijing’s crackdown on Muslim Uighurs in Xinjiang, less than one week after Congress passed legislation supporting anti-government protests in Hong Kong.

There is broad support in Congress for Trump's push to punish China for years of alleged economic espionage, cyber attacks, forced technology transfer and dumping of low-priced goods made with massive government subsidies.

US and Chinese officials have repeatedly offered mixed messages about the direction of the trade talks.

On Wednesday, Trump said trade talks with China were going “very well,” sounding more optimistic than his remarks the previous day that a deal might have to wait until after the 2020 US presidential election.

Washington imposed additional 15 percent tariffs on about $125 billion worth of Chinese goods on September 1, on top of the additional 25 percent tariffs levied on an earlier $250 billion list of industrial and consumer goods. A new round of US tariffs is set to kick in on December 15, covering about $156 billion of Chinese imports.

Former US Secretary of State Henry Kissinger has warned the US-China trade war could lead to a global military conflict if the two countries fail to resolve their commercial dispute.


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