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China’s Vice-Premier Liu He says the trade war talks will continue in Beijing. Photo: EPA-EFE

China’s Vice-Premier Liu He says ‘small setbacks’ will not derail trade war talks

  • Despite ending without a deal, lead negotiator describes latest talks in Washington as ‘constructive’, says next round will be held in Beijing
  • In candid interview, Liu outlines differences between the two sides but rejects allegations China reneged on earlier commitments

The latest trade war talks between China and the United States in Washington may have ended without a deal on Friday, but Beijing’s top negotiator said the negotiations had not broken down.

Speaking to selected Chinese media in the US capital before heading home, Vice-Premier Liu He described the meetings as “candid and constructive” and said the two sides agreed to meet again in Beijing to continue their discussions.

“The negotiations have not broken down,” he says in a video clip published on Xinhua’s website.

“Quite the opposite. I think they are normal. Small setbacks are inevitable in bilateral negotiations. Looking ahead, we are cautiously optimistic about the future.”

Vice-Premier Liu He described his latest meetings with US trade negotiators Robert Lighthizer (centre) and Steven Mnuchin (right) as “candid and constructive”. Photo: EPA-EFE

For the first time, Liu also outlined the differences between the two sides. In unusually frank and timely comments, he said that while Beijing and Washington still had problems to resolve, he dismissed allegations that China had reneged on earlier promises and commitments.

In a transcript of the press interview published on the website of Phoenix Television, a Hong Kong-based broadcaster, Liu said there were several issues on which the two sides still disagreed.

No resolution as trade war talks end in Washington

“China believes tariffs are the starting point of the bilateral trade disputes,” Liu said. “If a deal is to be reached, the tariffs should all be eliminated. This is the first point.”

The second regarded China’s promise to buy more goods from the US, he said.

While an initial deal was reached when Chinese President Xi Jinping and US President Donald Trump met in Argentina in December, the two sides now held different views on what had actually been agreed, Liu said.

“This is a very serious issue,” he said, adding that the deal had to be both balanced and fair.

It was a matter of principle that the two sides were not only cooperative but also respectful of one another, Liu said.

“We are very clear that we cannot make concessions on matters of principle. We hope our US colleagues understand this.”

Liu said the trade negotiators on both sides of the table had shown they were sincere in their efforts to tackle problems and resolve differences, but reaching a deal was not a short or easy process.

“We need to take it bit by bit,” he said. “It’s like running a marathon. It gets harder as you reach the final stages. At that moment, you need to hold on to get past the dark and reach the dawn. We just hope that there can be understanding and support on all sides.”

Trump says trade deal may still happen after Xi’s ‘beautiful letter’

The latest talks in Washington came just hours after Trump made good on his threat to increase tariffs on US$200 billion worth of Chinese imports. He justified the move by saying Beijing had delayed the process of reaching a trade deal by reneging on commitments it had made during months of negotiations.

Liu said China strongly opposed the tariff increase and would “have to respond”.

“We hope the US adopts a restrained approach,” he said. “China will also show restraint. We should prevent an unlimited escalation.”

While problems remained between the US and China – on issues such as forced technology transfers, intellectual property protection and state-sponsored enterprise – it was vital the two sides did not overreact, he said.

US President Donald Trump on Friday made good on his threat to increase tariffs on US$200 billion worth of Chinese imports. Photo: Bloomberg
Meanwhile, the vice-premier talked up the resilience of China’s economy, citing rising industrial competitiveness and strong domestic consumption.

“China firmly opposes the trade war, but is fully prepared for it and will deal with the matter rationally,” he said.

Chinese state media on Saturday took a defiant stand on Washington’s latest efforts to increase the pressure on Beijing.

“China requires that all tariffs be eliminated to restore normal bilateral trade,” People’s Daily, the mouthpiece of the Communist Party, said in a commentary.

“The trade procurement figures should be realistic, the text must be balanced and expressed in a way that is acceptable to the Chinese people and does not undermine the country’s sovereignty and dignity.”

This article appeared in the South China Morning Post print edition as: talks will go on, says lead china negotiator
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