‘They cannot slow walk this’: US expects immediate action from China after trade truce, says Trump adviser Larry Kudlow

  • No stalling, White House economic adviser Larry Kudlow warns Beijing, after trade-war ceasefire is struck between Donald Trump and Xi Jinping
  • The deal is said to include lower tariffs on cars and measures against intellectual property theft – but it’s not yet in writing
PUBLISHED : Tuesday, 04 December, 2018, 5:26am
UPDATED : Tuesday, 04 December, 2018, 12:28pm

The United States expects China to live up to a pledge to act immediately on trade issues after a deal reached by the countries’ leaders, including lower tariffs on automobiles and measures against intellectual property theft and forced technology transfers, White House official Larry Kudlow said on Monday.

US President Donald Trump and Chinese President Xi Jinping agreed to hold off on new tariffs for 90 days during talks in Argentina on Saturday, declaring a truce following months of escalating tensions on trade and other issues.

That 90-day period will begin on January 1, White House economic adviser Kudlow told reporters.

The Chinese offered more than US$1.2 trillion in additional commitments on trade, Treasury Secretary Steven Mnuchin said on Monday. Kudlow said that figure was a broad benchmark and referred to private transactions for buying US goods, subject to market conditions.

Trump praises talks with Xi as China readies for trade mission

China also committed immediately to start lifting tariffs and non-tariff barriers, including reducing its 40 per cent tariffs on autos, Kudlow said.

However, none of the commitments were agreed to in writing and specifics had yet to be hammered out.

Kudlow, director of the National Economic Council, said he, Mnuchin and US Trade Representative Robert Lighthizer held two private meetings with China’s Vice-Premier Liu He in Argentina, who told them that Beijing would move immediately on the new commitments.

“The history here with China promises is not very good. And we know that,” Kudlow said. “However, I will say this: President Xi has never been this involved.”

Kudlow said: “They cannot slow walk this, stall this, meander this. Their word: ‘immediately’.”

How ceasefire may affect fortunes of China’s partners and rivals

The two countries are “pretty close on some agreements on intellectual-property theft, pretty close to some agreements on the forced transfer of technology from American companies,” Kudlow said.

The truce boosted global markets on Monday with world stocks rising to their highest in about three weeks. On Wall Street, the benchmark S&P 500 gained nearly 1 per cent, although the index had come off its earlier session highs in afternoon trading.

Kudlow said US officials would monitor Chinese progress on enforcing the commitments very closely.

Mnuchin said there was a shift in tone at Buenos Aires from past discussions as Xi offered a clear commitment to open China’s markets to US companies.

With a trade war truce, it’s time to let China’s best minds go to work

“This is the first time that we have a commitment from them that this will be a real agreement,” Mnuchin told CNBC.

They cannot slow walk this, stall this, meander this. Their word: ‘immediately’’
Larry Kudlow

Trump has appointed Lighthizer, one of the administration’s most vocal China critics, to oversee the new round of trade talks with China, officials said.

The appointment of Lighthizer, who just completed a new agreement with Canada and Mexico, may signify a harder line in talks with Beijing and marks a shift from past practices where Mnuchin had a lead role.

“He’s the toughest negotiator we’ve ever had at the USTR and he’s going to go chapter and verse and get tariffs down, non-tariff barriers down and end all these structural practices that prevent market access,” White House trade adviser Peter Navarro told National Public Radio earlier on Monday.

Kudlow said he and Mnunchin would be heavily involved as well, with the Treasury secretary dealing with financial and currency issues.

On Sunday, Trump tweeted that China had agreed to cut import levies on American-made cars.

Chinese exporters do not expect rapid trade war resolution

Chinese regulators did not respond to requests for comment on Trump’s tweet on autos tariffs. Neither country had mentioned auto tariffs in their official readouts of the Trump-Xi meeting.

The White House is stepping up efforts to prod other countries to build more vehicles in the United States. Lighthizer and other officials including Kudlow are set to meet with German carmakers on Tuesday, including the chief executives at Volkswagen and Daimler, people briefed on the matter said.

Kudlow said on Monday the meeting was not meant to focus on potential car tariffs, though Trump still held that option in his “quiver”, and the carmakers would be encouraged to build engines in the United States.

Additional reporting by Associated Press