Chinese officials are signaling that they will not negotiate broad reforms to China’s industrial policy or government subsidies, two key demands the U.S. has said are central to a trade deal, according to a Bloomberg News story.
Vice Premier Liu He, who is China’s lead trade negotiatior, told dignitaries visiting China in recent weeks that the offer he would be bringing to the U.S. this week would include only a narrow set of proposals, Bloomberg reported Sunday.
China’s stance is seen as reflecting the view that China has gained the upper hand in negotiations, perhaps because of recent signs of weakness in the U.S. manufacturing sector and political disarray in the U.S. following the decision by Democrats to pursue impeachment. U.S. officials warn that if China sees Trump as desperate for a deal because of impeachment that would be a “miscalculation,” according to Bloomberg.
Trump officials, including White House economic adviser Larry Kudlow, have repeatedly said that they would not accept anything short of an all-encompassing deal. That sets the stage for a conflict when the two sides meet in Washington, D.C. this week.
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