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US, China Trade Envoys to Hold Talks   01/17 06:03

   The top U.S. and Chinese trade envoys will hold talks in Washington this 
month in a possible sign of progress toward ending a costly tariff battle over 
Beijing's technology ambitions.

   BEIJING (AP) -- The top U.S. and Chinese trade envoys will hold talks in 
Washington this month in a possible sign of progress toward ending a costly 
tariff battle over Beijing's technology ambitions.

   The Ministry of Commerce announcement of the Jan. 30-31 event was the first 
sign of a next step by the two sides following negotiations in Beijing earlier 
this month between lower-level officials.

   China's economy czar, Vice Premier Liu He, was invited by U.S. Trade 
Representative Robert Lighthizer, the ministry said.

   Economists and business groups said earlier that a decision by Liu and 
Lighthizer to take part in person would indicate technical discussions made 
enough progress to require high-level political decisions.

   The two sides have imposed tariff hikes of up to 25 percent on tens of 
billions of dollars of each other's goods in the fight over U.S. complaints 
Beijing steals or pressures companies to hand over technology. Washington also 
is pressing China to roll back plans for state-led industry development that 
its trading partners say violate its market-opening obligations.

   The Washington talks are aimed at carrying out the Dec. 1 agreement by 
Presidents Donald Trump and Xi Jinping to suspend further tariff increases for 
90 days while they negotiate, said Ministry of Commerce spokesman Gao Feng.

   They are likely to take up more complex U.S. complaints about Chinese policy 
on which lower-level officials "couldn't give a clear response," said Yu 
Chunhai, a trade expert at Renmin University in Beijing.

   Chinese officials have suggested Beijing might adjust its industry plans. 
But they reject pressure to abandon what they consider a path to prosperity and 
global influence.

   Liu probably will tell U.S. officials "what China can and can't do," said Yu.

   For their part, Chinese leaders object to U.S. export controls on "dual use" 
technology with possible military uses. They say Chinese companies are treated 
unfairly in national security reviews of proposed corporate acquisitions, 
though almost all deals are approved unchanged.

   "Such communication must be made between officials at a higher level," said 

   Neither side has shown any sign of changing its basic position. Economists 
say the 90-day window is too short to resolve conflicts that have strained 
their relations for nearly two decades.

   Chinese exports to the United States held up through much of 2018 despite 
Trump's tariff hikes but contracted by 3.5 percent in December compared with a 
year earlier as the penalties began to depress demand.

   Liu held talks in June in Beijing with U.S. Commerce Secretary Wilbur Ross 
as trade tensions mounted. They failed to produce a settlement and Trump went 
ahead the next month with his first tariff hikes.

   Liu made a surprise appearance at this month's talks in Beijing. Financial 
markets took that as a positive sign. Global stock markets rose but then fell 
back after the meeting produced no agreements.

   U.S.-Chinese relations are increasingly strained over technology, trade and 

   This month's talks in Beijing went ahead despite the arrest of an executive 
of Chinese technology giant Huawei in Canada on Dec. 1. The United States wants 
her extradited on charges that she lied to a bank about dealings with Iran.

   On Thursday, The Wall Street Journal reported U.S. prosecutors are 
investigating whether Huawei stole trade secrets from U.S. companies.

   The investigation was prompted in part by a lawsuit brought by T-Mobile U.S. 
Inc. that accused two Huawei employees of stealing technology for a robotic arm 
used to test mobile phones, the Journal said, citing unidentified sources. The 
two companies settled their dispute in 2017.

   "We doubt the intentions behind this," said a foreign ministry spokeswoman, 
Hua Chunying. She said it would be "inconsistent with the rules of free and 
fair competition" if U.S. authorities "arbitrarily used the state apparatus to 
suppress Chinese enterprises."

   Beijing has tried to defuse pressure for more sweeping changes by 
emphasizing its growing importance as an import market and promising more 
access to its auto and some other industries.

   Trump has complained repeatedly about the U.S. trade deficit with China. 
China reported Monday its 2018 trade surplus with the United States swelled to 
a record $323.3 billion.

   Beijing also faces complaints from the European Union. The 28-nation trade 
bloc has filed a challenge in the World Trade Organization against Chinese 
licensing rules it says hinder foreign companies from protecting and profiting 
from their own technologies.


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