Aug 01, 2019 07:05 AM

U.S. and China End Shanghai Trade Talks Without Reporting Progress

U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with China’s Vice Premier Liu He in Shanghai for the12th round of high-level talks. Photo: VCG
U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with China’s Vice Premier Liu He in Shanghai for the12th round of high-level talks. Photo: VCG

The U.S. and China will resume trade talks in September in Washington after two days of meetings in Shanghai ended Wednesday without any declared progress on key issues. It was the first formal sit-down by trade negotiators since top leaders declared a truce in the trade war at a G-20 meeting in late June.

No joint statements were issued after U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with China’s Vice Premier Liu He Tuesday and Wednesday in Shanghai in the12th round of high-level talks.

Under a consensus reached by President Xi Jinping and President Donald Trump at the G-20 in Osaka, the two sides conducted a “candid, efficient, constructive and in-depth exchange” on major issues of common concern in the economic and trade field, China’s Commerce Ministry said in a statement (link in Chinese) Wednesday evening. The issues included increasing Chinese purchases of U.S. agricultural products and providing favorable conditions by the U.S., the ministry said.

In the midst of the talks, Trump blasted a series of tweets Tuesday morning criticizing China’s trade practices, alleging that the world’s second-biggest economy isn’t buying more U.S. agricultural products as promised.

“My team is negotiating with them now, but they always change the deal in the end to their benefit,” Trump tweeted.

The president suggested that China may be waiting until after the 2020 U.S. election, expecting a more favorable deal if a Democratic candidate wins. But he threatened a “much tougher” deal or “no deal at all” if he wins.

In response to questions on whether the latest talks broke up in discord, Chinese Foreign Ministry spokeswoman Hua Chunying said Wednesday at a routine press conference that she was not aware of the latest developments during the talks, but that it was clear who has been “backbiting, breaking promises and capricious.”

In response to a question about Trump’s tweets, the spokeswoman said it doesn’t make any sense for the U.S. to exercise its campaign of maximum pressure. “It’s pointless to tell others to take medication when you’re the one who is sick,” Hua said.

Douglas Paal, vice president of studies at the Washington think tank Carnegie Endowment for International Peace, told Caixin that it’s too early to predict how the U.S. election will affect the trade negotiations with China.

“In many ways, it’s more politically attractive to be fighting for an agreement than to defend one on public record,” Paal said.

Even before the latest round of talks, expectations for progress during the Shanghai meetings were low. U.S. officials and experts had widely expected the China-U.S. trade negotiations to be a long-term process, possibly dragging out past the 2020 U.S. election.

Larry Kudlow, director of the U.S. National Economic Council, had dampened expectations about any major breakthroughs in Shanghai.

“I wouldn’t expect any grand deal,” Kudlow told CNBC in an interview Friday. “Talking to our negotiators, I think they’re going to reset the stage and hopefully go back to where the talks left off last May.”

Trump has long argued that the U.S. economy is immune from the trade war with China, but the most recent data suggest that it is not doing as well as he and many Americans had expected. Data showed weak U.S. exports and business investment in the second quarter. The Federal Reserve, which has repeatedly cited trade conflict as a downside risk, is expected to cut interest rates Aug. 1 to encourage growth.

David Dollar, a senior fellow at the Brookings Institution think tank in Washington, said the U.S.-China trade situation may now just be stuck in a status quo because the U.S. economy is slowing down and is expected to continue to slow.

“The Trump Administration will be careful about escalating the tariffs because that would be harmful to the U.S. economy,” Dollar said at an event Monday, “But they also may think it’s not in their best political interests to roll back the existing tariffs.”

The U.S. has said China proposed to meet in Shanghai instead of Beijing, a move many saw as a sign of good intentions by China as Shanghai has played an important role in U.S.-China relations.

Shanghai was where the U.S.-China communiqué was signed in 1972 during U.S. President Richard Nixon’s historic visit to China. The document was an important step in the normalization of China-U.S. relations and paved the way for Beijing and Washington to establish official diplomatic relationships later.

Chinese trade negotiators hosted their U.S. counterparts for dinner at the historic Peace Hotel in Shanghai Tuesday evening. The landmark hotel on the city’s riverside Bund has hosted guests including Charlie Chaplin and former U.S. Presidents Ronald Reagan and Bill Clinton. In 1971, a group of U.S. table tennis players who became the first Americans to visit China as relations thawed also stayed at the hotel.

Contact editor Han Wei (

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