AP Photo/Evan Vucci
- President Donald Trump said Friday that the next round of trade negotiations between the US and China could be canceled.
- The comment cast doubt on hopes that the two sides could dodge sweeping escalations set for September.
- Trump also announced that the US would cut ties with Huawei, a Chinese telecommunications and smartphone giant that has become a bargaining chip at the center of trade negotiations.
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President Donald Trump said Friday that the next round of trade negotiations between the US and China might not happen, casting doubt on hopes that the two sides could dodge sweeping escalations set for September.
Asked by reporters on the White Houses’ South Lawn whether the talks in Washington next month would be canceled, Trump replied: "Maybe. We’ll see what happens."
Trump said the meeting with US Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin, and their Chinese counterparts was still scheduled to take place. But he also emphasized that he was not ready to make any deal. Tariffs on another $300 billion worth of Chinese imports are scheduled to take effect on September 1.
Trump also said the US would cut ties with Huawei, a Chinese telecommunications and smartphone giant that has become a bargaining chip at the center of trade negotiations. While he added that the ban could change if a deal were reached, the prospect of de-escalation has dimmed in recent days.
Derek Scissors, a China scholar at the conservative-leaning American Enterprise Institute, said he saw a significant chance of new tariffs. The key event to watch is the August 19 expiration of the temporary general license for supplying Huawei, he added.
"If the US announces new, long-term licenses by then, China has a reason to respond cooperatively," Scissors said. "Otherwise, there’s very little time before the tariff deadline."
The Friday comments capped off a week of dramatic escalations in the yearlong economic dispute between the US and China that has led to more than $350 billion worth of tariffs and weighed on global trade flows.
Angry at China for not following through with a pledge to buy more agricultural products from the US, Trump announced plans to raise tariffs. China has sought to reduce its reliance on American farmers in an effort to retaliate against the Trump administration.
China has continued to respond with countermeasures, suggesting this week that it would wield the agricultural market and its currency against the US. The Treasury Department in a rare move on Monday named China a currency manipulator after the yuan fell beyond the psychologically important level of 7 against the dollar.
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See Also:
- ‘Not investing in China is very risky’: Billionaire investor Ray Dalio explains why he’s still all in despite recent trade-war fireworks
- It makes literally no sense that the White House just labeled China a currency manipulator
- Obama advisor Larry Summers warns the world is at ‘most dangerous financial moment’ since 2009 as global markets reel from trade war escalation
Source: Business Insider – gheeb@businessinsider.com (Gina Heeb)