China To Send Delegation To Continue Talks Amidst Trump's Tariff Threats
Despite threatening to raise tariffs on more than US$200 billion worth of Chinese goods, China announced that it will still be sending its trade delegates to the United States to continue trade negotiations. China's Ministry of Foreign Affairs announced earlier in the week that its trade representatives are still scheduled to visit the United States this week to meet with their counterparts.
Analysts previously feared that China was going to be backing out of the talks following President Donald Trump's sudden threatening tweets over the weekend. Trump threatened to significantly increase tariffs from 10 percent to 25 percent this week, citing that China had backtracked on substantial commitments it made during the trade talks. The tariffs would also target other Chinese imports "soon."
The country's chief negotiator, Vice Premier Liu He, is reportedly already scheduled to arrive in the United States this week. The delegation Liu will be leading still hopes that it can resolve the current situation with the US to eventually reach a win-win agreement as soon as possible. Chinese officials are reportedly now "gathering information" to better find a resolution to the current issue.
China's Ministry of Foreign Affairs' spokesman Geng Shuang told reporters earlier in the week that the Chinese team is already prepared to travel and that they are still positive that an agreement can be reached.
The deterioration of the current trade conversations between two of the world's largest economies comes at a vital time in the 10-month-old trade dispute as tensions continue to escalate. The situation quickly hit global financial markets, which immediately reacted in the face of an uncertain future for the US-China trade talks.
US Trade Representative Robert LIghthizer mentioned to reporters that they had seen an "erosion" in the commitments made by China to the United States, which the government views as unacceptable. Lighthizer further stated that the commitments China made were pivotal in some of the agreement the US had also committed to. Officials did not specify which of the commitments China had not kept, but they have already decided to take immediate action.
Prior to Trump's tweets, global markets were optimistic that a deal could be signed as early as this week. However, that optimism was quickly overturned, with markets reacting accordingly. Shares in both China and the United States quickly tumbled following the tweets, with China's Shanghai Composite Index dropping by more than 5 percent after Monday's trading session. Oil prices also reacted, with significant drops across the board.