Top China Trade Official Makes Surprise Stop at U.S. Trade Meetings

The USS Decatur sailing through the South China Sea in 2016

The USS Decatur sailing through the South China Sea in 2016

The working level talks held at the Chinese Commerce Ministry were the first round of face-to-face discussions since both sides agreed to a 90-day truce in a trade war that has roiled worldwide markets.

President Donald Trump argued that China has not treated the USA fairly in terms of trade.

Lu Kang, spokesman for China's foreign ministry, said on Monday that Chinese military aircraft and naval vessels were dispatched to identify the U.S. vessel and warn it to leave the area near the disputed Paracel Islands in the South China Sea, claimed by China.

U.S. Commerce Secretary Wilbur Ross said there is "a very good chance" that the United States and China will reach a trade agreement.

"Liu's participation in the meeting, held at the ministry's premises, signals that China is attaching high importance to the talks, even if the main participants this time are mid-level officials", Bloomberg wrote.

The operation came as Chinese and USA officials kicked off talks in Beijing to find a solution to a bitter trade war that prompted the two sides to impose tariffs a year ago on more than $300 billion in total two-way trade.

Trump raised import duties on Chinese goods in July over longstanding complaints Beijing steals technology or pressures foreign companies to hand it over.

USA officials worry that China's rise as a potential competitor in telecoms, solar power, electric cars and other fields might erode American industrial leadership.

How China will enforce those measures will be key to any deal. Ross said the talks are at an "appropriate level" and the USA delegation is large because of the number of issues to be addressed.

Previous U.S. Navy surface operations of this kind have challenged China's requirements for prior notification before the conduct of innocent passage transits in the 12 nautical mile zone of the features it occupies in the Paracel group. These include expanded Chinese purchases of American products, greater protections for U.S. intellectual property, constraints on Chinese industrial policy, and enforcement and verification of follow-through by China.

Trump is likely feeling the urgency of resolving the trade war, too, as signs of uncertainty have wreaked havoc on Wall Street and the global markets in recent months.

But much work remains before the two economic powers climb down.

The meeting marks the first face-to-face talks between the two governments since Chinese President Xi Jinping and President Donald Trump agreed to a tariff truce when they met during G-20 summit. Trump has given U.S. Trade Representative Lighthizer until March 1 to negotiate an accord with the Chinese on "structural changes" to Beijing's state-driven economic model.

The meeting between the US delegation - led by Deputy US Trade Representative Jeffrey Gerrish and including officials from the Treasury, Commerce, Agriculture and Energy Departments - and the Chinese side ran late into Tuesday night.

The White House is making sure this go-around is different.

Latest News