US threatens to block trade talks

with China at G20

White House wants list of concessions from Beijing
before Trump-Xi negotiations

© AP

US officials have warned China that Donald Trump will not engage in trade
talks with Xi Jinping at next month’s G20 summit if Beijing does not produce
a detailed list of concessions, according to two people briefed on negotiations
between the countries.

The Chinese, however, say they have such a list but would not present it
without some guarantee of it being received in a stable political climate in
Washington, including a point person with a mandate to negotiate on behalf
of the Trump administration, according to the two people.

US officials have been frustrated by what they see as Beijing’s unwillingness

to discuss substantive “structural issues” related to its economic and trade
policies. Beijing has been similarly irritated by the erratic approach of the
Trump administration, and the inability of US cabinet officials to negotiate
binding deals.

At the first round of trade talks in early May, US negotiators presented Vice
Premier Liu He with a detailed list of more than 140 specific demands,
ranging from the elimination of market access barriers to large, long-term
purchases of US energy and agricultural commodities that would reduce
Beijing’s large goods trade surplus with the US.

In August, Chinese negotiators indicated that they could reach agreement on

about a third of the demands relatively quickly and were willing to engage in
discussions on another third.

The remainder, they added, were off-limits because of national security or

other concerns. These included US demands that China’s domestic cloud
computing market be opened to foreign companies.

But Mr Liu’s team has not yet presented its detailed response to US
negotiators. Chinese officials were prepared to do so at a fifth round of trade
talks in Washington last month, but the discussions were abruptly cancelled
after Mr Trump slapped tariffs on more than half of all Chinese exports to the
US.

Officials now say that they need China’s response well in advance of the G20
summit in Buenos Aires scheduled for November 30, in order to pave the way
for substantive trade discussions between the two leaders. Mr Xi and Mike
Pence, the US vice-president, are also due to attend the annual Asia-Pacific
Economic Cooperation leaders’ summit in Papua New Guinea on November
18.
China clashes with US over trade tensions

Both Mr Liu and his deputy negotiator, Vice Commerce Minister Wang
Shouwen, remain reluctant to visit Washington after a dramatic deterioration
in bilateral relations. Chinese negotiators have instead suggested that a US
cabinet official should visit Beijing in the coming weeks to advance the talks.

On Monday, Chinese foreign minister Wang Yi and US secretary of state Mike

Pompeo traded barbs, with each blaming the other for undermining the
relationship between Washington and Beijing.

The unusually testy public exchange came just days after Mr Pence launched
a scathing attack on Beijing, accusing China of trying to sway the outcome of
the US midterm elections through propaganda and influence operations. The
following day, the Pentagon released a report warning about the
consequences of Beijing’s alleged grip on military and industrial supply
chains.
In another reflection of escalating tensions, Terry Branstad, the US
ambassador to Beijing, has been summoned by Chinese foreign ministry
officials twice over recent weeks. The first dressing down occurred on
September 23 after the US government sanctioned a Chinese military unit
and its commander for buying armaments from a Russian company that had
been blacklisted by Washington.

Mr Branstad was summoned for a second time after Mr Trump alleged, in a

speech to the United Nations on September 26, that the Chinese government
was attempting to influence the outcome of next month’s congressional
elections — an allegation repeated by Mr Pence last week, without citing any
evidence.

Mr Pence’s recent move to speak publicly on China issues has officials in

Beijing wondering if he is an appropriate point person after overtures to
Jared Kushner, Mr Trump’s son-in-law, and various cabinet officials have
failed to yield a reliable line of communication to the White House.

China has designated Mr Liu and vice-president Wang Qishan to deal with
the US. But some visiting Americans worry that Mr Wang’s discursive style
will quickly exhaust Mr Trump’s attention span.

Follow Tom Mitchell and Lucy Hornby on Twitter at @tmitchpk and

@HornbyLucy