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China still preparing to go for trade talks after Trump cranks up pressure

Credit: Reuters Studio
Published on May 6, 2019 - Duration: 02:23s

China still preparing to go for trade talks after Trump cranks up pressure

As global markets took a nose dive, Beijing says its delegation is preparing to go to the United States for trade talks after U.S. President Donald Trump said he would raise tariffs on $200 billion worth of Chinese goods this week and target hundreds of billions more soon.

Ed Giles reports.

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China still preparing to go for trade talks after Trump cranks up pressure

After a day of uncertainty over China-U.S. trade talks, Beijing said on Monday (May 6) it was still planning to send a trade delegation to Washington this week.

That's following tweets from U.S. President Donald Trump on Sunday (May 5) saying talks were too slow, and more tariffs will come this week.

Sending confidence in a brewing trade deal - and global markets - tumbling.

China's foreign ministry said it hopes the U.S. will meet China half way.

But at the same press conference did not answer a question about whether Beijing would now still send its top trade official, Liu He, to the meet.

A Chinese trade team was due to head to D.C.

This week for talks that White House official Larry Kudlow said on Friday (May 3) were looking positive.

(Soundbite) (ENGLISH) LARRY KUDLOW, WHITE HOUSE NATIONAL ECONOMIC COUNCIL DIRECTOR, SAYING: "We've come a long way.

So next week is very important when Vice Premier Liu He comes to town.

The engagements and discussions will continue on all the key subjects, all the key subjects including enforcement of course.

So we'll see.

I think it'll be a clearer picture by the end of next week." But that was all thrown into chaos by Trump's weekend tweet saying he was ready to hike U.S. tariffs on $200 billion of Chinese imports from 10 percent to 25 percent this Friday (May 10).

And while Trump's surprise tweet sent tensions sky high, global markets took some sharp falls.

China's Shanghai Composite closed down by more than 5 percent Monday and Europe's DAX index fell at the open.

The markets were also reacting to a report in the Wall Street Journal that the Chinese delegation's trip was set to be canceled altogether.

The editor of China's state-run newspaper the Global Times also tweeting he thought it was quote "very unlikely" China's top trade man Liu He would now attend.

In DC though Trump's tweet drew rare bipartisan support - with Senate Democratic leader Chuck Schumer urging the president to quote "hang tough" saying "strength is the only way to win with China".

If Trump's change of heart sticks, it would reverse his February decision to keep tariffs steady at 10 percent, when he cited progress on a deal.

The trade war is now entering its second year.

It resulted in billions of dollars in losses for both countries last year, hitting industries including autos, technology, and agriculture Also inflicting damage on other countries that rely on trade, including Germany and Japan.

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