WASHINGTON / BEIJING (Reuters) – Three weeks to go before planned talks between Chinese and US leaders, prospects for progress towards the end of the trade war are low and sources say there was little preparation for even meeting the health of the global economy is involved.
President Donald Trump says he is trying to meet President Xi Jinping at the June 28-29 summit of the G20 in Osaka, Japan and will decide on extending tariffs to almost all Chinese imports after that.
While neither side has confirmed that a meeting will take place, investors around the world will have seen more than a trillion dollars from world markets over the past month at the trade fight closely watching any interaction between the two men.
The relationship has deteriorated since May when the negotiations broke down the US-China trade disputes, but they could not kill an agreement in Japan.
“The atmosphere is poisonous,” said one Beijing-based senior diplomat with Reuters, referring to China-U. connect.
Sources familiar with the subject, including officials and diplomats in Washington and Beijing, say there is a lack of preparatory work for the meeting, largely due to the increasing morale. The trade negotiating teams have not come together since talks closed on 10 May.
The White House refused to comment on plans for the Trump-Xi meeting.
“Preparations for the G20 summit in Japan are ongoing. We do not currently have any announcements on specific bilateral meetings, ”spokesman Garrett Marquis, National Council of the National Security Council.
Larry Kudlow, the Whitehouse economic adviser, told CNBC on Tuesday that Trump is hoping to “pick up where we left” in the talks with Xi.
Trump said again on Monday that he hoped the meeting would happen, and he added more Chinese import tariffs if there was not enough progress or if Xi did not meet them.
China is open to more trade talks but has nothing to announce about a possible meeting between the two leaders, a spokesman for the Ministry of Foreign Affairs, Geng Shuang, said Monday. He said on Tuesday that China would "fight to the end" if Washington increased trade fiction.
Sources said that it is likely that the two leaders will have some meeting but what happens in Osaka, it is a downgrade from the possibility that the two sides had only affected two months ago – when the talks were expected to be in attendance. for both president to sign a historic trading market.
A senior Chinese official told US business representatives last week that preparations for the Trump-Xi meeting had not yet commenced or that they would re-open trade negotiations, a source with direct knowledge of the information said.
Regarding the US side in recent years, the lack of preparation for a large meeting varies. Trump often attends important talks with little work in advance and makes a policy on the flight.
Xi may not want to go into such a high profile meeting even with an unpredictable result and facing more threats of tariffs on Chinese goods.
“For China it's all about a protocol for Xi and make sure it is respected,” said Asian diplomat. “China won't want Xi to go into a meeting where he could be ashamed.”
Eswar Prasad, a professor of trade at Cornell University and former head of the Chinese department at the International Monetary Fund, said expectations were low.
“The best result of a Trump-Xi meeting, which seems to be a suspicious recommendation at this point, is an agreement for both sides to engage in talks again,” said Prasad, who is in contact with Chinese officials. “The prospects for temporary and limited ceasefire have fallen and the cards appear to have a long period of trade and wider economic tension between the two countries.” T
If the talks go badly, both sides could raise tariffs on each other, Trump could withdraw licenses for businesses that trade with Chinese telecommunications giant, Huawei, and China could Rare supplies prevent rare-earth supplies for high-tech products as well as take measures against US companies in China.
Trade negotiations broke down in May and both sides raised tariffs on hundreds of billions of dollars to import each other.
Trump accused Beijing of undertaking commitments to meet US demands for the extension of intellectual property protection, the elimination of state sponsored cybercrime, opening up markets for US firms, and the reduction of industrial subsidies.
China has said that the demands of the United States are so extensive that they violate their sovereignty.
A source of ties with Chinese leadership said that there was deep anger in government and the party about Trump's allegations of China's overthrow, especially when Beijing thought it was about to deal.
The source was responding to the US response to the feeling that you were jilted at the altar.
“You don't agree to marry someone and then say out at the last minute,” said the source, who meets regularly with senior officials, with Reuters.
Xi and Trump met last year in Buenos Aires and broke in advance in trade talks.
The US Treasury Secretary, Steven Mnuchin, drew similarities between the planned Osaka meeting and that contact, telling Reuters that the pace of preparations for the two meetings was similar.
However, unlike the current uncertainty about plans for the meeting in Japan, the White House confirmed that the Argentine talks were taking place as early as six weeks in advance.
The tension U.-China has gone beyond tariffs. The United States approved Huawei, they sent their fleet into the South China South Sea and the Taiwan Strait, which has been disputed, and made other public support for Taiwan.
It is expected that it will be difficult for diplomats to agree the language of the G20 statement issued at the end of the summit.
The host country, Japan and the European Union countries are working with the United States on the new World Trade Organization rules aimed at reinforcing "non-market-oriented policies" including industrial subsidies, targeted rules. clear of China.
It is expected that Beijing will stand against language in the statement that the United States may subsequently use trade talks in China.
Reporting by David Lawder in Washington and Ben Blanchard in Beijing, further reporting by Alex Alper and Jeff Mason in Washington, Chris Prentice in New York and Michael Martina in Beijing. Edited by Simon Webb and Alistair Bell
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