WASHINGTON -- President Donald Trump said he is open to letting a March 1 deadline to raise tariffs on Chinese products pass without penalty if the two sides are near an agreement, sending a conciliatory signal as talks to resolve a trade war between the countries continue.
"If we're close to a deal where we think we can make a real deal and it's going to get done, I could see myself letting that slide for a little while," Trump said to reporters during a Cabinet meeting Tuesday. "But generally speaking, I'm not inclined" to delay raising tariffs, he added.
Negotiators from the world's two largest economies began their latest round of talks this week ahead of the March 1 deadline, when the United States has said it will increase tariffs on $200 billion worth of Chinese goods to 25 percent from 10 percent.
Both Trump and his top trade negotiator, Robert Lighthizer, have previously said the deadline is a firm date and that the United States will not extend the timeline, which Trump and President Xi Jinping of China agreed upon during a dinner in Buenos Aires, Argentina, last year.
But with many of the biggest issues unresolved and the deadline drawing near, Trump appeared ready to give both sides more time to negotiate. And he once again suggested that he and Xi may ultimately need to iron out the remaining differences before a final deal is reached.
"At some point, I expect to meet with Xi and make the parts of the deal that the group is unable to make," Trump said.
Midlevel officials began discussions Monday in preparation for two days of talks starting Thursday involving Lighthizer, Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He. Lighthizer and Mnuchin were seen arriving at a Beijing hotel Tuesday.
Aides to Trump say this week's talks are important because they need to demonstrate credible progress to the president and for financial markets. The world's two biggest economies are locked in a dispute over U.S. allegations that China steals U.S. technology and forces American companies to turn over trade secrets in exchange for access to the Chinese markets. The tactics are alleged to be part of China's push to challenge U.S. technological dominance.
U.S. officials are pressing China to commit to deeper changes to a state-driven economic model that they say hurts U.S. competitors.
One of Trump's most persistent economic promises has been to rewrite the U.S. relationship with China. Yet with less than a month before the deadline for either a deal or an increase in U.S. tariffs, hardliners inside and outside the administration have expressed concern that Trump is being outplayed by Xi and seduced by what they see as empty promises.
For now, China primarily appears willing to buy more U.S. goods, like soybeans, but has not indicated how many other concessions it is prepared to make. And while both countries have expressed optimism about bridging their differences, Xi is facing pressure in China not to agree to a deal that would jeopardize his country's economic or national security. China's economy is growing at its slowest pace in years, in part because of the U.S. tariffs.
Trump on Tuesday once again portrayed China's economic weakness as the United States' strength, saying it was in China's interest to make a deal. The United States, he said, could benefit by retaining tariffs on $250 billion worth of Chinese goods, and once again he inaccurately suggested that China was paying the levies.
"I'm happy either way," he said. "I could live receiving billions and billions of dollars a month from China. China never gave us 10 cents. Now they are paying billions a month for the privilege of coming into the U.S. and honestly taking advantage."
While the United States is collecting billions in tariffs, that money is not coming directly from China but from companies and customers who buy goods imported from China.
The Trump administration is poised to issue this week an executive order to secure American telecommunications networks, a move that's likely to result in barring Chinese tech firms such as Huawei, according to three U.S. officials.
The order, which Trump is expected to sign by Friday, would give the commerce secretary broad powers to stop American companies from doing business with foreign suppliers.
In development for more than a year, it will lay out the administration's concern that foreign-owned or controlled suppliers of equipment and services could compromise the security of the United States' phone and Internet infrastructure.
The pending announcement comes as U.S. officials continue to press their case with allies and foreign countries that companies such as Huawei, which has close ties to the Chinese government, pose considerable risk to burgeoning high-speed telecom networks -- what's known as 5G.
Officials cautioned that last-minute snags could delay the new order, which has been anticipated since last summer. But they stressed that any holdups are not related to ongoing, high-level trade talks between Washington and Beijing aimed at ending the two countries' months-long trade war.
"This is a national security issue, not a trade issue," said one U.S. official, who like two others interviewed for the story, spoke on the condition of anonymity to discuss internal deliberations. "We're not doing this to increase the leverage [with China]. This is on a separate track."
The White House and Commerce Department declined to comment. Huawei did not immediately respond to a request for comment.
The order, whose existence in draft form was first reported by The Washington Post in June, will not ban specific companies or countries, officials said. But the regulations that result from the order, depending on how they are written, may have an outsize impact on China and Chinese-made technology, which U.S. officials have come to view with increasing alarm.
"This is crossing the Rubicon -- asserting government power to block commercial transactions," said Clete Johnson, a former senior cybersecurity adviser at the Commerce Department and now a partner at Wilkinson Barker Knauer. "Just the authority itself could have enormous long-term implications in the U.S. and global markets, and in U.S.-China relations."
A report issued Tuesday by prominent scholars and former top White House, State Department and trade officials working on China concluded that to compete with a more assertive China, the United States should invest in alliances and multilateral institutions, which Trump and his administration have rejected.
In addition, the Trump administration should take firm stands against China on its malign policies, from mercantilist measures to military expansionism, but should avoid overreacting to hard-line actions by Xi and the Communist Party while searching for areas of cooperation with Beijing, the report said.
The United States and China "find their bilateral relationship at a dangerous crossroads," said the report, issued by the Asia Society and the 21st Century China Center at the University of California, San Diego. "The United States and China are on a collision course. The foundations of goodwill that took decades to build are rapidly breaking down."
Information for this article was contributed by Saleha Mohsin and Margaret Talev of Bloomberg News; by Deborah B. Solomon and Edward Wong of The New York Times; by staff members of The Associated Press; and by Ellen Nakashima and Tony Romm of The Washington Post.
A Section on 02/13/2019