US Treasury initiates trade talks with China
13 Sep 2018 - by
Asian markets surged on the news that Chinese officials had been invited by US Treasury secretary Steven Mnuchin to discuss ongoing trade disputes.
AFP reports that “the possible resumption of negotiations sent Asian markets rallying with Hong Kong surging 2.5%.”
Shanghai also edged higher by 1%.
Prior to the news, sentiment had slumped for six straight days as bear market conditions fed on US administration announcements that President Donald Trump was considering an all-out tariff offensive against Chinese goods worth more than $500bn.
Chinese commerce ministry spokesperson Gao Feng, after indicating that President Xi Jinping’s government welcomed the invitation, told reporters that an “escalation of the trade conflict is not in the interest of either party”.
White House economic adviser Larry Kudlow said it was good that trade talks between the US and China had been initiated.
The move by Mnuchin’s office comes on the back of complaints from US companies working in China about the impact of US tariffs on China for them.
AFP reported that “the majority of American companies in China say they are hurting from the escalating trade spat, reporting increased costs, lower profits and stepped-up scrutiny.”
A recent survey conducted by the American Chamber of Commerce in China found that “more than half of US firms are already feeling Beijing’s wrath” ever since America instituted tariffs on $50bn of Chinese imports earlier this year.
China-based US companies have reported that regulatory scrutiny, increased company inspections, and slower customs clearance have created an atmosphere of fear and suspicion.