US President Donald Trump has claimed that China was seeking to U-turn on the trade deal struck between the two countries in the hope that it could renegotiate with a Democratic president following the 2020 election.
He also said that China's vice-premier Liu He would fly to Washington this week for the next stage of talks as originally planned.
Trump tweeted: “The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to “negotiate” with Joe Biden or one of the very weak Democrats, and thereby continue to ripoff the United States (($500 Billion a year)) for years to come…”
He continued: “Guess what, that’s not going to happen! China has just informed us that they (Vice-Premier) are now coming to the U.S. to make a deal. We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling U.S. coffers…great for U.S., not good for China!”
The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to “negotiate” with Joe Biden or one of the very weak Democrats, and thereby continue to ripoff the United States (($500 Billion a year)) for years to come….— Donald J. Trump (@realDonaldTrump) May 8, 2019
According to sources close to the talks, Beijing reneged on a series of agreements reached in previous rounds of negotiations, Reuters reported this morning. China has allegedly rowed back on promises to change its domestic laws in areas such as intellectual property and forced technology transfers.
China’s apparent reversals prompted Trump’s ire, who announced via Twitter on Sunday the dramatic ratcheting up of tariffs, which US trade representative Robert Lighthizer subsequently confirmed would take effect on Friday.
The ramping up of trade tensions between the world’s two biggest economies has dragged on markets this week. Today the Dow Jones industrial opened down 0.1 per cent, to stand at 25,957.99, after falling 1.2 per cent yesterday.
The benchmark S&P 500 was also marginally down today, having yesterday dropped one per cent.
Investor fears were compounded this morning upon the news that China’s gigantic trade surplus unexpectedly narrowed in April. The country’s exports fell 2.7 per cent year-on-year in a sign that pressure from the US was hurting the Chinese economy.