US and Chinese officials will hold talks by phone this week and next as they work to finalise the “phase one” trade deal announced last week, US Treasury Secretary Steven Mnuchin said on Monday.
President Donald Trump, beset with an impeachment inquiry and criticism over his foreign policy, on Friday hailed the breakthrough agreement, but said it would take several weeks to finalise the details before he signs a pact with Chinese leader Xi Jinping next month.
There are few specifics, nor does the deal roll back the tariffs already imposed on hundreds of billions of dollars in trade between the world’s two dominant economic powers.
But Mnuchin indicated the next round of new tariffs due to hit consumers on December 15 could be scrapped once the deal is signed.
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He pushed back on the scepticism about the agreement in an appearance on CNBC. “There is a fundamental agreement in principle,” he said. “There are still some issues that need to be worked out in wording but I would say we have every expectation that phase one will close.
“So I would describe phase one as quite substantial.”
He said deputy-level officials will hold discussions by telephone this week, while he and US Trade Representative Robert Lighthizer will have a call with China’s trade envoy, Vice Premier Liu He, next week.
The senior officials will then meet in Santiago, Chile, on the sidelines of the APEC ministerial meeting, before the leaders summit where Trump and Xi are expected to sign the pact.
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The initial deal, which finally breaks an 18-month trade spat, included a massive increase in China’s purchases of US farm products, and also covers intellectual property, financial services and currencies.
Mnuchin also said the sides had agreed on “real enforcement mechanisms” in case further disagreements arise between Washington and Beijing over the terms of the deal.
Meanwhile, stocks were wobbling between small gains and losses in early trading on Wall Street on Monday as investors remain cautious about the prospects of a full trade agreement between the U.S. and China.
Technology stocks were posting some solid gains even as the energy sector fell because of a decline in the price of crude oil. Safe-play sectors like utilities held up relatively well.
Bond markets and the US government were closed for the Columbus Day holiday.