China and US upbeat on progress after Washington trade talks

China and the US were upbeat on progress towards settling their trade disputes after wrapping up two days of tough negotiations in Washington, sending Chinese markets higher ahead of a deadline to avoid additional tariffs.

Both sides signalled developments on bilateral sticking points beyond their trade imbalance – with a focus on structural issues and an enforcement mechanism – after talks led by Chinese Vice-Premier Liu He and US Trade Representative Robert Lighthizer concluded on Thursday. Follow-up discussions are slated for early February in Beijing.

The talks covered a wide range of issues, including forced technology transfers, intellectual property protection, market access, the trade deficit, cybertheft, government subsidies to China’s state-owned enterprises, and currency controls, the White House said. But they did not discuss the US indictment against Chinese telecoms giant Huawei Technologies and its chief financial officer Sabrina Meng Wanzhou.

With the March 1 end to a 90-day truce on tariffs looming – and the threat of more US duties on US$200 billion worth of Chinese goods – both sides have been keen to make progress to stave off a further escalation of their trade war. US President Donald Trump on Thursday said he looked forward to meeting Chinese leader Xi Jinping to iron out the final details of an agreement at an unspecified date.

Wei Jianguo, a former Chinese vice-commerce minister, said the terms of a potential deal could be better than expected – not only halting additional tariffs but also easing existing ones.

“An agreement would resolve misunderstandings on both sides and find a path for them to go forward, so it would be a very high quality agreement,” he said.

Lighthizer said there would be a “brief pause” for the Lunar New Year, but that both sides were in the early stages of drafting a negotiating agreement that would not require congressional approval.