By Bloomberg News
China and the U.S. plan to meet again in September to extend trade talks, as the latest round of negotiations in Shanghai ended with signs the sides discussed Chinese purchases of American farm products -- a key demand of President Donald Trump.
U.S. delegates including Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer wrapped up talks with their Chinese counterparts including Vice Premier Liu He Wednesday afternoon at the Xijiao State Guest Hotel, according to a pool report. The U.S. delegation, which arrived Tuesday afternoon, was heading to the airport about 24 hours later.
The negotiators from Beijing and Washington discussed China’s imports of agriculture products from the U.S. based on its needs, state-run news agency Xinhua reported, adding that the September gathering will include high-level officials. The countries have alternated hosting a series of meetings in their more than year-long trade war.
The latest round of talks took place against a backdrop of a fresh outburst by Trump, who, as delegates gathered Tuesday, let fly at China’s perceived unwillingness to buy American agricultural products and said it continues to “rip off” the U.S.
S&P 500 futures stayed higher after the September meeting was announced.
Relations between the delegates appeared cordial, according to the pool report. Xinhua said it was a candid, efficient and constructive exchange on major economic and trade issues.
China’s trade minister Zhong Shan played a more prominent role in the discussions than in previous rounds. His greater involvement had caused concerns among some U.S. delegates as he is perceived as tougher negotiator.
Based on what I know, Chinese and US negotiators had an efficient and constructive deep exchange on Wednesday. The two sides discussed increasing purchase of US farm products and the US side agreed to create favorable conditions for it. They will hold future talks.
— Hu Xijin 胡锡进 (@HuXijin_GT) July 31, 2019
The Americans arrived in Shanghai on Tuesday and attended a dinner at the Fairmont Peace Hotel in the evening. A person familiar with the event described the atmosphere at the dinner as being all about rapport building without substance on negotiations.
The People’s Daily, mouthpiece of the Communist Party, responded to Trump on Wednesday with a commentary saying that China has no motive to “rip off” the U.S. and has never done so, and China won’t make concessions against its principles on trade.
On Wednesday, China’s foreign ministry spokeswoman Hua Chunying said at a briefing in Beijing that it doesn’t make any sense for the U.S. to exercise a maximum-pressure campaign. “Only when the U.S. shows enough sincerity and good faith can we achieve progress in the trade talks,” she said.
Expectations for a breakthrough in the trade talks have been low. The two sides are further apart than they were three months ago, when negotiations broke down and each side blamed the other for derailing attempts to reach a deal. China is pushing for compromise in the talks, with state media underlining this week that the U.S. should meet it “halfway.”
Data released Wednesday showed the outlook for China’s manufacturing sector brightening slightly, though the sector is still contracting. The manufacturing purchasing managers’ index rose to 49.7 in July, led by better conditions for large companies. The below-50 reading still signals contraction, though is better than the median estimate of 49.6 in a survey of economists. The non-manufacturing gauge fell to 53.7.
China’s leadership on Tuesday announced priorities for economic policy in the second half of the year, pledging to tackle ongoing tensions over trade “effectively” while offering incremental additions to stimulus policies. A statement released by the Politburo late Tuesday didn’t elaborate on the trade policies.
At the Fairmont Peace Hotel, U.S delegates were hosted at a dinner at the landmark of jazz-era Shanghai on the city’s riverside Bund, in a marked change of atmosphere from the previous Beijing encounters.
Shanghai is mainland China’s financial capital and its busiest port. The Peace Hotel’s setting in the former International Settlement, which the U.S. helped manage during a period of foreign interference that the Communist Party has vowed never to repeat, is also freighted with the complicated history of America’s relationship with China.