Trump, Xi upbeat on trade after phone call; U.S. targets
more Chinese firms
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[November 02, 2018]
By Susan Heavey and Michael Martina
WASHINGTON/BEIJING (Reuters) - U.S.
President Donald Trump and Chinese President Xi Jinping, who spoke by
telephone on Thursday, expressed optimism about resolving their trade
dispute ahead of a high-stakes meeting at the end of November in
Argentina.
But within hours of upbeat assessment, the U.S. Justice Department took
aim at another Chinese firm it accused of unfair practices, part of an
across-the-board pressure campaign by the Trump administration targeting
China.
Still, investors cheered the resumption of dialogue and a report that
Trump was taking steps to resolve the tariff war, with shares in Asia
hitting three-week highs on Friday and the dollar softening.
Trump said on Twitter that trade discussions with China were "moving
along nicely," and that he planned to meet Xi on the sidelines of a G20
summit, in Argentina, after the two had a "very good" phone discussion.
Bloomberg, citing people familiar with the matter, later reported that
Trump wants to reach a trade agreement with China at the G20 meeting and
that after the call with Xi, he had asked officials to begin drafting
possible terms.
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The news agency said it was not clear if Trump was easing up on demands
that China has resisted, and it cited one person as saying intellectual
property theft was a sticking point on a possible deal.
In comments in state media, Xi said he hoped China and the United States
would be able to promote a steady and healthy relationship, and that he
was willing to meet Trump in Argentina.
"The two countries' trade teams should strengthen contact and conduct
consultations on issues of concern to both sides, and promote a plan
that both can accept to reach a consensus on the China-U.S. trade
issue," Xi said on CCTV state television.
Xi was quoted as saying after the call with Trump that they had hoped to
expand trade cooperation.
Neither leader specified any details of possible progress in their first
known direct discussion in several months.
Trump administration officials have said that trade talks with China
cannot resume until it comes up with specific actions it is willing take
to meet U.S. demands for sweeping changes to policies on technology
transfers, industrial subsidies and market access.
The two countries have imposed tariffs on hundreds of billions of
dollars of each other's goods and Trump has threatened to put tariffs on
the remainder of China's $500 billion-plus exports to the United States
if the disputes cannot be resolved.
Jacob Parker, vice president of China operations at the U.S.-China
Business Council in Beijing, said there were plenty of challenges that
would require significant negotiations in advance of a meeting between
Trump and Xi to ensure success.
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"What negotiations have lacked to date has been that (presidential)
level of engagement. If President Trump makes an agreement with
President Xi, there is nobody above them to overturn it," he said.
"We're optimistic this is a potential off-ramp of increasingly
antagonistic trade tensions and hope it leads to a pause and new
negotiations," he said.
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![](../images/110218pics/2018-11-01T194812Z_3_LYNXNPEEA03FA_RTROPTP_4_CHINA-HONGKONG-BRIDGE_small.JPG)
Chinese President Xi Jinping attends the opening ceremony of the
Hong Kong-Zhuhai-Macau bridge in Zhuhai, China, October 23, 2018.
REUTERS/Aly Song
![](http://archives.lincolndailynews.com/2018/Nov/02/images/ads/current/graue_18_cruze090418.png)
Tu Xinquan, a trade expert at Beijing's University of International Business and
Economics, said he was sceptical that the Trump administration was truly ready
to deal, and that other factors, such as the mid-term congressional elections,
could be driving statements from the administration.
"The best situation (from a Trump-Xi meeting) would be no further actions,
temporarily. But the tariffs already imposed will not go away," Tu said.
INTELLECTUAL PROPERTY THEFT
Just after the upbeat readouts of the Trump-Xi call, the Justice Department
announced the latest in a list of actions against what the Trump administration
calls China's cheating through intellectual property theft, unfair corporate
subsidies and rules hampering U.S. corporations in China.
A Justice Department indictment targeted two companies based in China and Taiwan
and three individuals, saying they conspired to steal trade secrets from U.S.
semiconductor company Micron Technology Inc.
This week, prosecutors announced an indictment against 10 defendants, including
two Chinese intelligence officers and other computer hackers and
co-conspirators, who are all accused of breaking into American company computers
to steal data on a turbo fan engine used in commercial jetliners.
On Wednesday, U.S. Secretary of State Mike Pompeo said China was probably
Washington's biggest long-term security challenge and the United States was
engaged in a "multi-pronged effort ... to convince China to behave like a normal
nation on commerce" and respect international law.
![](http://archives.lincolndailynews.com/2018/Nov/02/images/ads/current/ldn_sda_062409.png)
But Trump struck a more affable tone on Twitter after the phone call with Xi.
"Just had a long and very good conversation with President Xi Jinping of China.
We talked about many subjects, with a heavy emphasis on Trade," Trump tweeted.
"Those discussions are moving along nicely with meetings being scheduled at the
G-20 in Argentina. Also had good discussion on North Korea!"
Earlier this week, Trump said he thought there would be "a great deal" with
China on trade, but warned that he had billions of dollars worth of new tariffs
ready to go if a deal did not materialize.
The United States has imposed tariffs on $250 billion worth of Chinese goods,
with duties on $200 billion of the total set to increase to 25 percent from 10
percent on Jan. 1, 2019.
China has responded with retaliatory duties on $110 billion worth of U.S. goods.
(Reporting by Susan Heavey, David Brunnstrom and David Lawder in Washington;
Joseph Campbell, Yawen Chen, and Ben Blanchard in Beijing, and Brenda Goh in
Shanghai; Editing by Simon Cameron-Moore and Clive McKeef)
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