US and Chinese negotiators start two days of high-level talks Wednesday aimed at settling a six-month trade war that has weakened both sides, shaken financial markets, and clouded the global economic outlook. Yet the odds seem stacked against any substantive resolution, reports the AP. "We are anticipating no big outcomes this week," said Erin Ennis, senior VP at the US-China Business Council. Earlier negotiations flamed out. And this time President Trump might be inclined to drive an especially hard bargain after being forced to cave in the shutdown dispute. Moreover, a new complication injected itself into US-China relations on Monday when the Justice Department brought criminal charges against Chinese tech giant Huawei, accusing it of stealing technology and violating sanctions against Iran. Beijing shot back by demanding that the White House pull back from an "unreasonable crackdown."
A deadline looms. On March 2, the Trump administration is to escalate its tariffs on $200 billion worth of Chinese imports from 10% to 25%. The American delegation to the talks is led by Trade Representative Robert Lighthizer, a longtime critic of Chinese trade practices and US policies that failed to blunt them. But "the idea of just grabbing (technology) however they can is kind of ingrained at this point," says one expert. "You can't just flip a switch." Deepening the challenge is the US view that China has pledged to shape up in the past—then failed to do so. DOJ's decision to charge Huawei, meanwhile, "has thrown a curveball" into the talks, says a strategist. US officials insist the Huawei case is entirely separate, but one IT think tank chief thinks the indictment was meant to send a signal to the Chinese. "This is about power politics," he said, "to get them to do what they should be doing."
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