China and US Engage in Fresh Round of Trade Talks to De-escalate Tensions

Strategic Insights -

China and the US will hold a new round of trade talks in Malaysia from Friday to Monday, in a bid to ease escalating tensions between the two nations. The negotiations come as an already-extended 90-day tariff truce is set to expire on November 10, and Washington's recent moves have threatened to undo hard-won progress made in previous talks. Analysts have warned that Washington's actions, including imposing export curbs and slapping additional port fees on Chinese-built and operated ships, do not build bridges and have eroded trust necessary for any lasting agreement.

Key Takeaways:

  • The US and China will hold a fresh round of trade talks in Malaysia from Friday to Monday, with the Chinese delegation led by Vice-Premier He Lifeng.
  • The negotiations will focus on "key issues concerning China-US economic and trade relations" and will aim to make progress on outstanding issues.
  • Washington's recent moves, including imposing export curbs and slapping additional port fees, have threatened to undo hard-won progress made in previous talks.
  • Analysts have warned that Washington's approach has eroded trust necessary for any lasting agreement.
  • The value of the trade talks lies not only in managing the economic relationship between the two giants but also in providing a predictable external environment for every nation that falls in their orbit.
  • Experts expect the management of rare earth elements to be an important topic during the upcoming trade talks.
  • China has made it clear that it does not impose rare earth export restrictions in the civilian sector and has balanced its approach to prioritize both supply chain stability and national security.

Statistics:

  • The 90-day tariff truce between the US and China is set to expire on November 10.
  • Washington has threatened to impose export curbs on "any and all critical software" to China in addition to additional 100 percent tariffs starting on November 1.
  • The US has already started slapping additional port fees on Chinese-built and Chinese-operated ships.

Sources:

  • "China Daily"
  • Wang Wen, dean of Renmin University of China's Chongyang Institute for Financial Studies
  • Xu Hongcai, deputy director at the China Association of Policy Science's economic policy commission
  • Chen Wenling, former chief economist at the China Center for International Economic Exchanges
  • Thomas Helbling, deputy director of the International Monetary Fund's Asia and Pacific Department.