China has “good faith” to fix trade issues as talks with US resume

China has the “good faith” to work with the United States to resolve trade frictions, the Foreign Ministry said on Monday, as the world's two largest economies resumed talks in a bid to end their trade dispute.

US officials are meeting their counterparts in Beijing this week for the first face-to-face talks since US President Donald Trump and China's President Xi Jinping agreed in December to a 90-day truce in a trade war that has roiled global markets.

Trump said on Sunday that trade talks with China were going very well and that weakness in the Chinese economy gave Beijing a reason to work toward a deal.

The two sides agreed to hold “positive and constructive” dialogue to resolve economic and trade disputes in accordance with the consensus reached by the countries' leaders, Foreign Ministry spokesman Lu Kang told reporters at a regular news briefing.

“From the beginning, we have believed that China-US trade friction is not a positive situation for either country or the world economy. China has the good faith, on the basis of mutual respect and equality, to resolve the bilateral trade frictions,” Lu said.

Trump imposed import tariffs on hundreds of billions of dollars of Chinese goods last year and has threatened more to pressure Beijing to change its practices on issues ranging from industrial subsidies to intellectual property to hacking. China has retaliated with tariffs of its own.

“As for whether the Chinese economy is good or not, I have already explained this. China's development has ample tenacity and huge potential,” Lu said. “We have firm confidence in the strong long-term fundamentals of the Chinese economy.”

No major breakthrough

Lu also said that Vice President Wang Qishan would attend the World Economic Forum in Davos, Switzerland in late January, but added that he had not yet heard of any arrangements for a meeting with Trump there.

By Monday afternoon, few details had emerged of the talks, which were scheduled to run through Tuesday.

The US delegation, led by Deputy US Trade Representative Jeffrey Gerrish, includes under secretaries from the US Departments of Agriculture, Commerce, Energy and Treasury, as well as senior officials from the White House.

Tu Xinquan, a Chinese trade expert at Beijing's University of International Business and Economics, told Reuters before talks began that the meetings would likely focus on technical issues and leave major disagreements to more senior officials.

Slowing economies

“China's economy is significantly slowing down, and the US stock market is declining quickly. I think the two sides need some kind of agreement for now,” Tu said.

Data last week showed manufacturing has slowed in both China and the United States, though the US Labour Department on Friday reported a surge in new jobs in December along with higher wages. Officials have given scant details on concessions that China might be willing to make to meet US demands, some of which would require structural reforms unpalatable for Chinese leaders.

Even if a trade agreement is reached soon, analysts say it would be no panacea for China's economy, which is expected to continue decelerating in coming months.

China's stridently nationalist Global Times tabloid said in an editorial late on Sunday that statements from both sides that they hoped to reach a deal were cause for optimism, but that Beijing would not cave in to US demands. “If China was going to raise the white flag, it would have done it already,” the paper said.