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BEIJING -- China will not flinch in the face of American pressure to agree to a trade deal, Beijing's chief negotiator said in comments reported Saturday after the latest round of talks ended without agreement and higher tariffs were imposed on Chinese exports.

Liu He, China's vice premier, tried to strike a resolute but relatively conciliatory note Friday before he left Washington after the end of the fractious talks.

"It is like a marathon. The last phase can be the hardest," Liu said in comments carried Saturday by Hong Kong-based Phoenix TV after the trade talks. "To sit out the dark before the dawn, we have to hang in there, and we hope we get the understanding and support of all aspects."

China was firmly opposed to a trade war but would keep a cool head while trying to resolve it, he said. "China is not flinching, and nor are the Chinese people."

Liu arrived in Washington on Thursday for talks just a few hours before the Trump administration increased tariffs on $200 billion of Chinese goods had increased from 10% to 25%.

Talks on Thursday night and Friday failed to break the deadlock over President Donald Trump's insistence that Beijing agree to make structural changes to its economy in addition to buying more American goods to redress the trade imbalance between the world's two biggest economies.

Two-way trade between the countries totals more than $660 billion a year, but most of that is Chinese exports to the United States. China ran a trade surplus of close to $420 billion with the U.S. last year.

The two sides appeared close to reaching an agreement last month, with Trump saying they were on the brink of an "epic" deal. But that fell through after meetings in Beijing two weeks ago, after which Trump accused China of reneging on its agreements and threatened to increase the tariffs he had imposed last year in an effort to show Beijing he was serious.

Trump made good on that threat at 12:01 a.m. Friday, Washington time. China responded two minutes later saying it had no choice but to take "countermeasures." But authorities in Beijing have not released any details, leading analysts to think they are biding their time in the hope an agreement can be reached before the tariffs kick in.

The tariffs do not apply to goods in transit, only to those shipped after the tariffs were increased. That gives the two sides about two weeks before ships leaving China arrive on the United States' west coast.

Liu said China wanted the U.S. to roll back the new tariffs. "China believes that it was the tariffs that started all the trade frictions, and in order for us to reach an agreement, all [punitive] tariffs should be retracted," he told Phoenix.

But he also revealed that the two sides were deadlocked over both the economic changes that China should carry out and the amount of additional American products China should be buying to narrow their trade imbalance.

"On the issue of purchases, the state leaders of China and the U.S. reached a consensus during their meeting in Argentina and had a preliminary agreement on the numbers," Liu said. "But the two sides are now disagreeing on how big the number should be. For China, we think this is a very serious issue and cannot compromise on it easily."

The Trump administration had also wanted China to commit to changing laws as part of stepping up intellectual property protections and to stop forcing American companies to share their technological secrets, accusing Beijing of trying to water down previously agreed provisions for this.

"China is not regressing or reneging; we are only addressing divergences in some of the text and we want them resolved. Therefore, we don't think it necessary to overreact on this issue," Liu said.

Beijing authorities also tried to strike a careful note in a commentary published Saturday, but warned that there would be no quick solution to the trade war.

"We have to realize that the 'fighting while talking' scenario will probably come to stay throughout the U.S.-China trade negotiations, and we will have to adapt to that," said the commentary carried on Taoran Notes, a social media site which Beijing has increasingly been using to manage domestic expectations on the trade war.

"The negotiation is not breaking down, instead, it is having an interlude as the two sides are unable to resolve their differences in a short time," Taoran Notes said Saturday.

While it was possible there would be an "explosion of frictions and conflicts" between China and the U.S., Taoran Notes said the two countries were capable of blazing a new trail: "One that manages to keep disagreement under control while helping the two get along by giving consideration to the greatest common factor between their respective interests."

A Section on 05/12/2019

Print Headline: China vows strong trade stance


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