WASHINGTON: Negotiations for the second phase of a pending US-China trade deal will begin promptly but the outcome may wait until after this year’s elections, President Donald Trump said Thursday. Trump’s remarks come days before Beijing’s trade envoy is due in Washington to sign a “phase one” agreement, marking a pause in the two sides’ nearly two-year trade war.
The US leader also openly cast doubt on whether American farmers would be able to supply China with the massive increases in agricultural exports expected to be part of the deal. “We’ll start right away negotiating phase two. It will take a little time,” Trump told reporters.
“I think I might want to wait to finish it until after the election because I think we can make a little bit better deal, maybe a lot better deal.” After efforts to reach a grand bargain proved elusive last year, the two sides agreed in December to a partial deal addressing only some of Washington’s grievances about Chinese trade practices.
Since the trade war began, talks have broken down acrimoniously more than once. And observers have speculated in recent weeks there may be little appetite for Phase Two even though many of the tariffs put in place during the conflict remain in place. As part of the “Phase One” deal, China has committed to a minimum of USD 200 billion in increased purchases over the next two years from the United States, including USD 50 billion in additional farm exports, according to US Trade Representative Robert Lighthizer.
Annual US farm exports to China peaked in 2012 at USD 26 billion, a time when commodity prices were higher. “The big question I have is whether or not the farmers will be able to supply all that much more,” Trump said Thursday. “It’s the biggest contract ever signed.” Earlier on Thursday, China’s commerce ministry confirmed Vice Premier Liu He will travel to Washington next week to sign the “Phase One” agreement.
Markets have been cheered in recent weeks by the continued cooling of trade frictions between Washington and Beijing. AFP
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