Published: Tue, January 08, 2019
Markets | By Erika Turner

United States warship sails in South China Sea amid trade talks with Beijing

United States warship sails in South China Sea amid trade talks with Beijing

China and USA officials started negotiations Monday in the first face-to-face meetings since Presidents Donald Trump and Xi Jinping agreed in early December on a 90-day truce.

The talks come a month after Trump and Xi agreed to suspend a planned tariff hike for three months to give negotiators space to reach an agreement and end a dispute that has roiled world markets.

Trump imposed import tariffs on hundreds of billions of dollars of Chinese goods a year ago and has threatened more to pressure Beijing to change its practices on issues ranging from industrial subsidies to intellectual property to hacking. US Commerce Secretary Wilbur Ross went on CNBC this morning to tell Joe Kernen that Tim Cook should stop being such a whiny bitch when it comes to the whole China situation.

Lu Kang, the Foreign Ministry spokesman, said at a press conference that his government formally protested to the representatives of that nation in Beijing against the illegal entry of the USS McCampbell missile destroyer into the South China Sea on Monday.

China on Monday said it was optimistic about the latest round of trade negotiations with the USA that started here as both sides showed willingness to end their disputes.

China on Friday cut bank reserve requirements amid slowing growth at home and pressure from the United States tariffs.

Ahead of the meeting in Beijing, US President Donald Trump said negotiations between the two sides were going "very well".

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The talks went ahead despite tensions over the arrest of a Chinese tech executive in Canada on US charges related to possible violations of trade sanctions against Iran. They complain China's companies are treated unfairly in national security reviews of proposed corporate acquisitions, though nearly all deals are approved unchanged.

For their part, Chinese officials are unhappy with USA curbs on exports of "dual use" technology with possible military applications. China has said it could consider a deal that involves increasing its purchases of United States goods.

US Deputy Trade Representative Jeffrey Gerrish is to lead the delegation that is to meet with Chinese counterparts starting today. It's their first face-to-face meeting since the two leaders agreed at a Group of 20 summit in Argentina last month not to impose new tariffs that were due to take effect January 1.

Even if a trade agreement is reached soon, analysts say it would be no panacea for China's economy, which is expected to continue decelerating in coming months.

"China's economy is significantly slowing down, and the US stock market is declining quickly". It deferred the imposition of the next round of tariffs a year ago, until at least March 1, by agreeing to buy U.S. soy beans and other products and removing the tariff surcharge it had imposed on auto imports from the US.

For their part, Chinese officials are unhappy with USA curbs on exports of "dual use" technology with possible military applications. "China is willing to resolve the dispute based on mutual respect and equal footing", he said.

"We have made stern complaints with the U.S.", Lu said.

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