Donald Trump says trade deal with China is ‘potentially very close’

But phase one is unlikely to be agreed before next tariff deadline

Donald Trump has said a trade deal with China is “potentially very close” – although phase one is unlikely to be agreed before 2020.

Speaking on the morning news show Fox and Friends, the US president said: “The bottom line is, we have a very good chance to make a deal.” However, he added he is “not anxious” to push through phase one, which could see a roll back of tariffs.

Trump’s announcement follows news from Myron Brilliant, a senior executive at the US Chamber of Commerce, that the initial phase of the deal may not be possible before the next tariff deadline on December 15.

Brilliant told CNBC he had spoken to China’s vice premier and chief trade negotiator, Liu He, advising him to have “some give and take”.

“China very much wants to see a rollback on the tariffs,” he said. “By the way, so does the American business community. But we’re not going to see an elimination of all the tariffs after phase one.”

Chinese president Xi Jinping said he wants to work for a phase one agreement based on “mutual respect and equality”.

Xi told visiting US delegates, which included former secretary of state Henry Kissinger, former treasury secretary Hank Paulson and former US trade representative Mike Froman, that while Beijing doesn’t want to start a trade war, they are “not afraid”.

“When necessary we will fight back but we have been working actively to try not to have a trade war.”

Trump retaliated on Fox and Friends, stating he didn’t like the word “equality” and that it wouldn’t be an “even deal”.

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In September the US imposed a 15 per cent tax on $112bn of Chinese imports, which included clothing, shoes and consumer electronics.

Brilliant acknowledged the trade deal should see a rollback on these taxes but said China shouldn’t have “aspirations that go greater than that”.

Commenting on the ongoing negotiations, Henry Kissinger said the US and China were “in the foothills of a cold war”.

“China is a major economic country and so are we. And so we are bound to step on each other’s toes all over the world, in the sense of being conscious of the purposes of the other.

“Therefore, if conflict is permitted to develop unconstrained, the outcome could be even worse than it was in Europe.”

FURTHER READING: Stocks ease from highs as hopes fade over swift US-China deal

FURTHER READING: Trump denies agreeing to roll back China tariff

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