US-China trade war: Beijing will honour phase one deal by opening financial sector wider, its central bank chief says

Vice-Premier Liu He is expected to hold a video conference this week with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin to discuss the trade deal

Central bank governor Yi Gang says Wall Street’s trading houses will be allowed to have exclusively owned brokerage operations in China

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Chinese Vice-Premier Liu He (left) and US President Donald Trump hold up signed copies of the phase one trade deal between their countries in January. Liu is expected to hold a video conference this week with the US side to discuss the deal. Photo: DPA

Published: 7:30pm, 10 Aug 2020Updated: 9:11am, 13 Aug 2020

China will continue to implement its part of the phase one trade deal with the United States and will fulfil financial opening-up pledges despite worsening bilateral relations between the world’s two largest economies, China’s central bank governor said in an interview with the official Xinhua news agency.

“No matter how the international situation changes, the most important thing is to get our own things done and to firmly deepen financial reform and opening-up,” Yi Gang, the head of the People’s Bank of China, was quoted by Xinhua as saying on Sunday.

“First of all, we will continue to implement the phase one trade deal with the US.”

The deal, signed at the White House in January and intended to serve as a truce in a bitter and protracted trade war between Beijing and Washington, has turned into one of the most stable elements in the broad bilateral relationship as the technological and geopolitical rivalry between two powers has intensified.

US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, who led the US negotiating team, are expected to hold a video conference with Vice-Premier Liu He this week to review the implementation of the deal. Liu headed China’s trade negotiation team and is in charge of opening up China’s financial sector as President Xi Jinping’s top economic adviser.

Beijing’s intention to continue honouring the trade deal, which requires China to significantly increase purchases of US goods and services and to enhance intellectual property rights protection, reflects the Chinese government’s efforts to keep US-China ties from sliding further into direct confrontation.

At the same time, China’s purchases of US farm and energy products are far behind schedule, partly due to the coronavirus, making it hard for US President Donald Trump to brag about the deal as one of his major achievements. US Democratic presidential candidate Joe Biden said last week that Trump’s trade deal with China was “failing” badly, Reuters reported.