So much for the (delayed) April meeting between Trump and Xi.
According to a report by the SCMP, the meeting between US President Donald Trump and Chinese counterpart Xi Jinping to end the trade war which was tentatively pushed back from March to April, may be pushed back again, this time to to June, as the two leaders "will not be able to finalise an agreement by April."
It had initially been hoped that they would be able to reach a deal more quickly, but one source who has been briefed on the arrangement told the South China Morning Post that a meeting in April was less likely, while another said the summit could be held in June.
As previously reported (almost daily), while the two nations have been stepping up negotiations on the text of the trade agreement, a SCMP source confirmed once again of the growing rift within the Trump administration regarding the deal with China, where the main division is how much importance will be attached to an enforcement mechanism to ensure the Chinese side lives up to its side of the bargain, or whether it will be enough to secure an agreement in principle and declare success.
Originally Trump and Xi were expected to meet at Trump’s Mar-a-Lago private resort in late March, but US ambassador to China Terry Branstad later said the summit had been delayed because the deal was still under discussion. Then, to much fanfare - with the narrative spun that a delayed meeting was only further proof of the two sides working hard to reach a deal - it was reported that the two leaders would meet in April, but the timetable now appears to have been put back once again.
It is not yet known where Trump and Xi would meet in June, but the Chinese president is also expected to travel to Osaka in Japan for the G20 summit.
For those who have missed the key hurdles to the signing of an official deal, the story goes like this: while the US has been content with China's promises to purchase more goods from the US for the next few years, the White House has been pushing China to address what remain the biggest long-standing grievances including the alleged theft of intellectual property, forced technology transfer and unfair competition.
US trade rep Lighthizer has been one of the main figures pushing for an enforcement mechanism to ensure that Beijing lives up to any pledges it gives. But Beijing is growing alarmed by the proposals and argued that enforcement must be “two-way, fair and equal”. The tough stance taken by Washington’s top trade negotiator has won bipartisan support in the US Congress - where Democrats are now insisting that Trump not rush to deliver a weak deal just to boost markets - as well as respect from his Chinese counterparts who describe him as detail-oriented and unlikely to back down.
“Lighthizer is a very professional and experienced trade negotiator. Talking to him is the right track to take,” another source said.
“Lighthizer is a tough negotiator but China pays high respect to him. China needs to step up its research on him”.
Meanwhile, critics have suggested that Trump’s enthusiasm for more tariffs may have eased because of the recent stock market fall - Trump reportedly said that a trade deal would propel the Dow some 2,000 point higher, suggesting that Trump's only goal is micromanaging of the stock maret - and concerns over the wider US economy, particularly from farmers who rely on exports to China. It has also been suggested that the reforms to China’s economic policies demanded by the US could take years to enact.
In the latest developments over trade talks, during a St Patrick’s Day reception at the White House on Thursday, Trump said: “We’ll have news on China. Probably one way or the other, we’re going to know over the next three to four weeks.” He added that China had been “very responsible and very reasonable,” saying: “If that one gets done, it will be something that people will be talking about for a long time.”
Regardless of yet another potential postponement to the meeting between the two presidents, the two sides are working to keep momentum going, and this week official Chinese state news agency Xinhua said “concrete progress” had been made following a phone conversation between Vice-Premier Liu He and US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Thursday. The news, predictably, helped propel markets higher on the now traditional "trade war optimism" narrative when in reality the two sides appear to be drifting ever further apart as the easy aspects of the negotiation have all be ironed out, and now the only outstanding items remaining are those which will make any any meaningful deal impossible.