Nearly six weeks after saying he had agreed "in principle" on a partial trade deal with China, President Donald Trump suggested Wednesday that the agreement might not be finalized this year because of foot-dragging by China.
Trump's comments were made while he toured an Apple supplier facility in Texas.
Asked by a reporter whether the deal would be completed this year, the president said: "I haven't wanted to do it yet because I don't think they're stepping up to the level that I want."
After nearly a year of bargaining, negotiators remain stuck on several core issues, including the extent of Chinese commitments to buy American farm products and the U.S.' willingness to reverse its tariff plans.
"We continue to talk to China. China wants to make a deal. The question is: Do I want to make a deal? Because I like what's happening right now. We're taking in billions and billions of dollars," Trump told reporters before his trip to Texas, making reference to the tariffs on Chinese products. Although he said the U.S. is receiving billions of dollars, the costs of the tariffs are overwhelmingly paid by American companies.
Stocks fell across the board in New York trading Wednesday after a Reuters report that the so-called phase one deal between the U.S. and China might not be finished this year. Trump on Nov. 8 acknowledged the possibility that reaching a deal could take longer than was previously expected.
"Understandably, the longer the talks drag out, the more investors are concerned that there will never be a resolution to the tariff dispute," said Andy Rothman, an investment strategist with Matthews Asia in San Francisco. "But I don't see any evidence that Trump has changed his mind about the importance of doing a deal, so I think it will get done."
The White House, meanwhile, pushed back on speculation that the deal is unraveling. "Negotiations are continuing and progress is being made on the text of the phase-one agreement," spokesman Judd Deere said in an emailed statement.
As the trade talks have dragged on, however, the diplomatic task has grown more complex. Congressional ire over the treatment of anti-government protesters in Hong Kong and over Beijing's repression of the Muslim majority in Xinjiang province are crowding the trade agenda.
Vice President Mike Pence earlier this week warned that it would be difficult to reach a trade agreement if China violently suppressed the Hong Kong protests, which are in their sixth month.
A bipartisan group of House and Senate members introduced legislation last week that seeks to punish China for its crackdown on Xinjiang's Uighur Muslims. And on Wednesday, Congress overwhelmingly voted to send Trump a measure supporting Hong Kong protesters.
Beijing has bristled at the criticism, saying crackdowns are needed to quell violence.
The president on Oct. 11 called reporters to the White House, where he announced "an agreement in principle" had been reached with China. Trump canceled a planned tariff increase scheduled for later that month in return for what he called "a very substantial phase-one deal."
Trump said China had agreed to roughly double its annual purchases of U.S. farm goods to more than $40 billion; open its financial services market; tighten its intellectual property protections; and refrain from using currency as a trade weapon.
Plans for the American and Chinese presidents to sign the deal at a mid-November Asian-Pacific summit collapsed when the host government in Chile canceled the meeting amid a wave of domestic unrest.
The next potential deadline that could force a compromise is Dec. 15, when Trump's next round of tariffs is scheduled to hit about $160 billion in Chinese goods. Those tariffs are expected to disappear if a deal is reached, according to sources familiar with the talks, who asked for anonymity because they were not authorized to speak to the press.
But Chinese officials want the U.S. to agree to a road map that would eventually eliminate all of the tariffs Trump has imposed since the trade war began last year.
Tariffs were a key consideration for Apple when it opted to build its next-generation Mac Pro computers in the Flextronics plant in Austin, Texas, which Trump toured Wednesday. The decision to locate the work in the U.S. was made after the company secured exclusions from the president's tariffs for several key parts.
A Flextronics worker showed the president, his daughter Ivanka and Treasury Secretary Steven Mnuchin the Mac Pro's metal bottom, which reads: "Designed by Apple in California. Assembled in USA," according to a pool report.
Trump held up the part to display the inscription and said: "That's what we want."
Information for this article was contributed by Josh Dawsey of The Washington Post.
Business on 11/21/2019