The U.S. and China resumed trade talks in Shanghai on July 30, but expectations were low. David Dollar, an expert on U.S.-China trade relations at the Brookings Institute, believes the two may make some small progress, but said they won’t reach a deeper agreement.
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with officials from the Chinese Communist Party in Shanghai, China, hoping to inch forward on a trade deal with the communist regime.
“Maybe make some small progress—China is willing to buy some agricultural products, the U.S. is willing the ease up on the sanctions on Huawei; but I think it’s unlikely we get a comprehensive trade deal. The best we can hope for is they set up some future meetings and that this is likely to continue to go on for quite a few months,” Dollar said.
A White House statement on July 24 said that this round of U.S.-China trade discussions “will cover a range of issues, including intellectual property, forced technology transfer, non-tariff barriers, agriculture, services, the trade deficit, and enforcement.”
However, Dollar said it will be hard for the two sides to make progress on structural issues. “[A] deeper agreement that deals with some of the things I mentioned—you know, market access issues, intellectual property rights protection—that would take a long time in negotiate. And there really hasn’t been adequate preparation, so you know it would be very surprising if they reach some kind of deeper agreement.”
The latest economic data shows that China’s economy has been seriously affected by the U.S.-China trade conflict; it grew by 6.2% in the second quarter, the lowest in the last 27 years.
And the U.S. GDP is expected to grow by 2.6% this year; a standout if compared globally.
“Imports from China down something like about eleven percent over last year, and that’s a moderately big number, but it’s too small to have a measurable effect on the US economy,” Dollar said.
President Trump recently said he thinks China may wait until after the 2020 U.S. elections before signing an agreement since Beijing would prefer to see if they can deal with a Democrat.
But regardless of who wins, the equation between the two nations has already changed.
Dollar said, “They’re prepared for the possibility that president Trump will be reelected, and they also think that even if he isn’t reelected, the U. S. relations with China are not going to go back to the very friendly relationships we had a few years ago.”
