US Treasury Secretary Steven Mnuchin says China trade talks nearing final round with US willing to face penalties for not complying
- He says the agreement will cover issues ‘that have never been dealt with before’
- ‘Very, very detailed agreement’ currently has seven chapters
US Treasury Secretary Steven Mnuchin said on Saturday that trade talks with China were nearing conclusion.
Mnuchin added that the US was open to facing “repercussions” if it did not live up to its commitments in any deal, a sign that the two sides are edging closer to an accord.
Since January, shuttle diplomacy between Washington and Beijing to resolve their nine-month trade war has dragged on longer than officials had expected. Both sides have continued to express cautious optimism without predicting success.
“It is more important to get it right than have arbitrary date,” Mnuchin told reporters. But “I’m hopeful we’re getting close to the final round of concluding issues.”
He spoke on the sidelines of the spring meetings of the World Bank and International Monetary Fund, which end this weekend.
Mnuchin said he had told the other finance officials that the negotiations were making progress but he would not disclose a timeframe for when they might be wrapped up.
He said both sides had conducted phone discussions over the past week, and he added that he and US Trade Representative Robert Lighthizer would hold two calls next week with Chinese Vice Premier Liu He.
The officials also were discussing whether more in-person meetings were necessary to conclude an agreement.
“If we are able to conclude this, it will be the most significant change in 20 years” in the economic relations between the two nations, Mnuchin said.
A sticking point in the talks has been American officials’ insistence that any final agreement have teeth – and that they retain the ability to impose fresh tariffs should Beijing backslide on its commitments.
Mnuchin declined to get into details on Saturday.
“There are certain commitments the United States is making in this agreement and there are certain commitments that China is making,” he said.
“I would expect that the enforcement mechanism works in both directions, that we expect to honor our commitments, and if we don’t, there should be certain repercussions, and the same way in the other direction,” he said.“
Asked whether market openings in the agreement would go beyond what was contemplated in the 2016 Bilateral Investment Treaty negotiations, he replied:
“We are making progress, I want to be careful. This is not a public negotiation ... this is a very, very detailed agreement covering issues that have never been dealt with before,” Mnuchin said. “This is way beyond anything that looked like a bilateral investment treaty.”
The BIT talks, pursued by former US President Barack Obama’s administration, stalled as China refused to satisfy US demands to open significant sectors of its economy to foreign investment.
The talks were not taken up by the Trump administration, which pursued tariffs on Chinese goods instead, leading to the current talks.
Trump said last week a conclusion in the talks was probably “four weeks” away but since discussions began earlier this year to end the nine-month trade war, the finish line has repeatedly slipped further into the future.
In a final statement from the meetings on Saturday, the IMF’s steering committee, which represents’ the organization’s 189 members, recognized the need to “resolve trade tensions” and support reforms of the World Trade Organization that have been demanded by the United States.
IMF chief Christine Lagarde said many officials at the meetings in Washington “actually made their views well known about the benefits of trade” for economic growth.
