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US, China hail major 'progress' in trade talks

US President Donald Trump and his Chinese counterpart Xi Jinping,
The United States and China said their trade war negotiations resulted in major progress as the clock ticks on a March deadline to avert a massive escalation of tariffs that could bruise the global economy.

US President Donald Trump hailed "tremendous progress" and welcomed a "beautiful" letter from his Chinese counterpart Xi Jinping, who said he hoped for further cooperation.

Beijing´s official Xinhua news agency said Friday that US and Chinese negotiators made "important progress" during two days of "candid, specific and fruitful" discussions in Washington.

Although the latest round of talks ended with positive words, the White House emphasized the two sides still faced the "hard deadline" of March 1 to avoid another sharp escalation in their trade war.

Economists say that prospect — which would mean more than doubling US tariffs on $200 billion in Chinese goods — would be a body blow to the global economy.

In a letter from Xi to Trump that was read out by the Chinese delegation, Xi said relations were at a "critical" stage and that he hoped "our two sides will continue to work with mutual respect."

Trump said relations between the two countries are "very, very good."

US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to China in mid-February for the next round of talks, according to Xinhua, and Trump said he would meet Xi after that to close the deal.

"We have to get this put on paper at some point if we agree. There´s some points that we don´t agree to yet. I think we will agree. I think when President Xi and myself meet, every point will be agreed to," Trump said.

With China´s economy slowing sharply and markets on edge at the prospect of further trade disruptions, the stakes for the talks have become especially high.

Last year, Washington and Beijing imposed tariffs on more than $360 billion in two-way trade, after Trump initiated the trade war because of complaints over unfair trade practices.

US duty rates on $200 billion in Chinese goods are due to rise to 25 percent from 10 percent if no agreement is reached by March 1.

"We haven´t talked about extending the deadline," Trump said.

'Much work to do'

Prior to this week´s talks, Beijing had offered to resume purchases of American soybeans, a major US export, sales of which had plummeted during the trade war, leaving US farmers reeling. Some exports have since resumed.

At Thursday´s meeting with Trump, Vice Premier Liu He said China agreed to purchase an extra five million tons of soybeans per day.

"That´s going to make our farmers very happy," Trump told Liu.

The White House later clarified that the purchase would not be daily and there had been no time frame set.

Xinhua later reported that the Chinese delegation said Beijing would increase imports of US agricultural, energy and industrial manufactured goods, as well as services.

China also vowed to increase cooperation on a major source of US discontent: intellectual property protection and concerns over the forced transfer of technology.

But the Xinhua report did not provide a dollar figure for the imports or concrete measures that China would take to protect IP rights.

US officials, including Lighthizer, say the world´s two largest economies are battling for future dominance in critical high-tech industries.

Attacking Chinese trade practices it says are unfair, Washington spotlights the forced transfer of American technology through requirements that foreign companies form joint ventures with local firms, as well as other methods of allegedly stealing American IP.

"It´s impossible for me to predict success but... it could happen," Lighthizer said Thursday, noting that the discussions included ways to enforce any ultimate agreement.

"We have much work to do."

A little over three years ago, Beijing launched a strategic plan dubbed "Made in China 2025" that aimed to make the nation the global leader in aerospace, robotics, artificial intelligence, new-generation autos and other areas -- sectors US officials say now represent the "crown jewels" of American technology and innovation.

Signs of progress in the talks have lifted global stock markets as investors took heart that the world´s two largest economies would avert an economic cataclysm.

The news from the White House emerged just prior to the closing bell on Wall Street, helping stocks bounce slightly and adding to the best January for the Dow Jones Industrial Average in 30 years.

Beijing implemented economic stimulus measures to shore up its economy after it last year posted the weakest growth for almost 30 years -- underscoring its vulnerability in the trade fight.

But Washington´s aggressive actions against Chinese telecom titan Huawei -- which federal prosecutors accused this week of industrial espionage, sanctions violations and fraud -- threatened to upend the talks and drew objections from Beijing.



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