Top-level US-China dialogue to lay groundwork for potential trade deal

Top-level US-China dialogue to lay groundwork for potential trade deal

US Secretary of State Mike Pompeo and Defence Secretary Jim Mattis will meet their Chinese counterparts Yang Jiechi and Wei

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Photo: Reuters/ Hyungwon Kang

US Secretary of State Mike Pompeo and Defence Secretary Jim Mattis will meet their Chinese counterparts Yang Jiechi and Wei Fenghe for top-level talks in Washington DC today.

It’s been a turbulent month for US-China relations. Today’s Diplomatic and Security Dialogue was originally slated for mid-October but was postponed over disputes about US military exercises in the South China Seas and Taiwan.

The frost appeared to thaw when Presidents Trump and Xi spoke over the phone last week and agreed to have dinner on the sidelines of the G20 summit in Argentina later this month. Then, on Monday, Xi suggested Beijing would lower tariffs and increase market access for foreign firms—key US demands underpinning trade tensions.

Reports now suggest that Trump has asked for a deal to be drafted to deescalate trade tensions—perhaps one that could be signed in Argentina. Such an agreement would be welcomed by stock markets and farmers—key to Trump’s re-election hopes in 2020.

However, over the long-term prospects for relations between the world’s two superpowers look bleak. A trade deal might paper over the cracks for now, but divergent strategic interests across the Asia Pacific—particularly over the South China Sea, Taiwan and North Korea—are likely to persist.

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