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US, China trade talks begin amid deep differences

File photo. Photograph:( Reuters )

Reuters Washington, DC, USA Jan 30, 2019, 08.53 PM (IST)

The United States and China launched critical trade talks on Wednesday amid deep differences over Washington's demands for structural economic reforms from Beijing that will make it difficult to reach a deal before a March 2 US tariff hike.

The two sides met next door to the White House in the highest-level talks since US President Donald Trump and Chinese President Xi Jinping agreed a 90-day truce in their trade war in December.

People familiar with the talks and trade experts watching them say that, so far, there has been little indication that Chinese officials are willing to address core US demands to protect American intellectual property rights and end policies that Washington says force U.S. companies to transfer technology to Chinese firms.

The US complaints, along with accusations of Chinese cyber theft of US trade secrets and a systematic campaign to acquire US technology firms, were used by the Trump administration to justify punitive US tariffs on $250 billion worth of Chinese imports.

Cabinet-level officials, led by Chinese Vice Premier Liu He and US Trade Representative Robert Lighthizer, gathered in the Eisenhower Executive Office Building next to the White House.

During a photo opportunity at the start of the scheduled two days of talks, Lighthizer, Treasury Secretary Steven Mnuchin and other top Trump administration officials sat silently across a long table from their Chinese counterparts, ignoring a reporter's questions.

The talks began two days after the United States charged Chinese telecommunications company Huawei Technologies Co Ltd and its chief financial officer, Meng Wanzhou, with conspiring to violate U.S. sanctions on Iran by doing business through a subsidiary it tried to hide.

Meng was arrested in Canada on December 1 at the request of the United States, which is seeking to have her extradited.

The talks in Washington are expected to be tense, with little indication so far that Chinese officials are willing to address core US demands to fully protect American intellectual property rights and end policies that Washington has said force US companies to transfer technology to Chinese firms.

The US complaints, along with accusations of Chinese cyber theft of US trade secrets and a systematic campaign to acquire US technology firms, were used by the Trump administration to justify punitive US tariffs on $250 billion worth of Chinese imports.

Trump has threatened to raise tariffs on $200 billion of goods to 25 per cent from 10 per cent on March 2 if an agreement cannot be reached. He has also threatened new tariffs on the remainder of Chinese goods shipped to the United States. China has retaliated with tariffs of its own, but has suspended some and is allowing some purchases of US soybeans during the talks.

Chinese officials deny that their policies coerce technology transfers.

Story highlights

Trump has threatened to raise tariffs on $200 billion of goods to 25 per cent from 10 per cent on March 2 if an agreement cannot be reached.