Published: Sat, December 08, 2018
Markets | By Erika Turner

Trump is leading USA trade negotiations with China: Mnuchin

Trump is leading USA trade negotiations with China: Mnuchin

The United States and China have been engaged in a long trade war.

The Dow dropped 799 points, or 3.1 percent, amid fears of an economic down turn that could come out of a failed deal to end the trade war with China.

The president, China's most powerful leader since at least the 1980s, flew from Argentina to Panama for an official visit and on Wednesday was in Portugal. "The problem is that something turned out to be nothing".

The prospect of more tariffs, affecting the Chinese economy and a broader range of American businesses, has sparked concerns about slowing global growth.

Stocks jumped higher around the world on Monday after the United States and China said they would hold fire on further tariffs for the time being and try to settle their differences through talks.

"It doesn't seem like anything was actually agreed to at the dinner and White House officials are contorting themselves into pretzels to reconcile Trump's tweets (which seem if not completely fabricated then grossly exaggerated) with reality", traders from JP Morgan wrote in their desk commentary Tuesday. But any such pact is not a guarantee, given deep divisions that remain between the countries and the administration's insistence that China end its practice of pressuring US companies to hand over valuable technology and trade secrets.

However, it still remains unclear when the purchases will take place and whether China will remove the retaliatory tariffs on these products or not; Beijing may instead choose to reimburse buyers for the tariffs paid as they have previously done so.

Trump has threatened to impose stiff tariffs on cars assembled in the European Union as part of his "America First" trade policy. "But if not remember, I am a Tariff Man", Mr Trump said on Twitter. "President Xi and I want this deal to happen, and it probably will", he said.

Traders work on the floor of the NYSE in New York 19/11/18
Image US stock markets endured a bruising session on Tuesday amid doubts a US-China deal is possible

In a statement, ministry said, "The economics and trade teams of both sides will actively push forward negotiations within 90 days in accordance with a clear timetable and roadmap".

Questions began to swirl after China's foreign minister read a statement Saturday in Buenos Aires that said Washington agreed to halt tariff hikes.

Stocks took a dive Tuesday as trade talks between the world's largest economies appeared to again hit a stalemate. "Narrow agreements and modest concessions in their ongoing trade dispute will not bridge the wide gulf in their respective economic, political and strategic interests".

Kudlow, director of the National Economic Council, said he, Mnuchin and U.S. Trade Representative Robert Lighthizer held private meetings in Argentina with China's Vice Premier Liu He, who told them Beijing would move quickly on its new commitments.

White House trade adviser Peter Navarro on the trade truce between the USA and China.

Many economists have expressed scepticism that very much could be achieved to bridge the vast disagreements between the two countries in just 90 days.

China, the world's largest auto market, raised tariffs on USA auto imports to 40 percent in July, forcing many carmakers to hike prices in a major hit to the roughly $10 billion worth of passenger vehicles the United States sent to China past year. For China, it must rethink its fundamental negotiating strategy and time is running out.

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