Trade talks aimed at averting a US-China trade war will resume in Washington next week, the White House announced on Monday. 

China’s Vice-Premier Liu He will visit the US capital “to continue the discussions with the president’s economic team”, White House press secretary Sarah Huckabee Sanders said. 

Word of the visit by Liu, China’s top economic adviser, came three days after a US delegation led by Treasury Secretary Steven Mnuchin left Beijing after two days of talks that produced no apparent consensus, leaving open the possibility that punitive tariffs on US$50 billion worth of imports from China would take effect in the coming weeks. 

US and China still divided as trade talks fail to make breakthrough

In last week’s talks, the United States demanded that China cut the trade deficit the US faced by at least US$200 billion by the end of 2020. The US said its trade deficit with China was US$375.2 billion last year.

Additionally, the US called on China to halt state subsidies for industries under its “Made in China 2025” plan. 

In the meantime, China’s trade surplus with the US continues to expand, growing by US$6.76 billion – or nearly 44 per cent month on month – to US$28.78 billion in April, according to Chinese customs data released on Tuesday.

The surplus with the US was US$22.19 billion in April, up from US$15.43 billion in March.

In the first four months of this year, the surplus with the US amounted to US$80.4 billion. The figure for the same time last year was US$70.9 billion, according to calculations based on official data.

China’s overall trade surplus was US$28.78 billion in April, a stronger rebound than expected after a surprise US$4.9 billion deficit in March.

In US dollar terms, China’s exports grew 12.9 per cent last month, compared with the same time last year. At the same time, imports rose 21.5 per cent year on year, faster than the 14.4 per cent increase in March and 16 per cent growth forecast.

Analysts said the opening round of talks in Beijing last week served only to communicate each side’s position. 

The Chinese government released a brief statement wrapping up the trade talks on Friday, calling the negotiations “candid and efficient”. A statement from the White House described the discussions as “frank”. 

No deal but state media strikes positive tone on China-US trade talks

China called on the US to cease its “section 301” investigation into China’s trade and industrial policies, and to lift restrictions on high-technology exports to China. That investigation prompted the US Trade Representative office to announce its US$50 billion list of targeted Chinese products, mostly machinery and electronics. 

In retaliation, China announced tariffs on an equivalent amount of imports from the US.

Sanders did not provide any further details about Vice-Premier Liu’s visit.

The Chinese embassy in Washington did not immediately respond to a request for comment. 

US trade deficit with China ‘must be addressed rationally’

Reactions to last week’s meeting in China’s state media had suggested Beijing was open to continuing talks. 

A commentary in the ruling Communist Party mouthpiece People’s Daily on Saturday described the talks by saying the “clouds are starting to part and the fog begins to disperse” after more than a month of “wind and rain”. 

It said that the talks marked a change from the recent tit-for-tat exchanges between Beijing and Washington and sent a positive signal for the global economy, adding: “There is hope that the two nations will move away from confrontation and towards consultation.” 

After US-China talks fail, Trump and Xi ‘may need to get involved’

China’s Commerce Ministry was studying measures to further lower import tariffs on some food, pharmaceuticals and medical instruments, Economic Information Daily reported on Monday, citing unidentified sources. If enacted, such a move would at least partly address US demands for easier access to China’s markets. 

Additional reporting by Zhenhua Lu, Bloomberg and Orange Wang

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