China may ask the US to remove tariffs before phase two talks: expert
Published: Jan 16, 2020 03:53 PM


China will need time to assess the just-signed phase one trade agreement and other complicating factors before launching negotiations with the US for a phase two agreement. US officials, including Vice President Mike Pence, who claim the talks are already underway may be getting ahead of themselves, a government advisor said on Thursday. 

Even if China agrees to begin negotiations for a phase two agreement, it will likely demand that the US roll back all tariffs prior to talks, a prominent trade expert in China suggested. 

"Given the complexity of the contentious issues that were left out, China may make key judgments about the launch of phase two trade talks by analyzing monumental international issues," an advisor to the Chinese Ministry of Commerce told the Global Times.

The advisor, who spoke on condition of anonymity, specifically mentioned a recent joint statement from the US, the EU and Japan, in which the trio proposed new global trade rules aimed at curbing subsidies. Some analysts have read the move as targeting China.

Though the ink isn't even dry on the phase one trade agreement, US officials have been mounting what appears to be another pressure campaign on China to commence negotiations for a phase two agreement.

During the signing ceremony, US President Donald Trump said that remaining US tariffs on Chinese goods would be removed if "we are able to do phase two." He also suggested he would visit China "in the not too distant future," reiterating an earlier statement that he would visit China following the phase one deal to begin phase two talks.

Other US officials went even further, saying the talks would start immediately after the phase one agreement was signed. Pence reportedly claimed that discussions had already begun on a phase two China-US trade deal.

Chinese officials have remained silent with regard to repeated statements from US officials, including Trump's suggestion that he would visit China. But analysts said that China will not rush into new talks for a second-phase deal due to potentially complicated outstanding issues.

"China is not in a hurry to commence the next phase of trade talks, which will involve deeper and more ingrained issues. We should therefore move more cautiously and steadily," said Dong Shaopeng, a senior research fellow at the Chongyang Institute for Financial Studies at the Renmin University of China.

Dong said China may demand that the US roll back all tariffs before it agrees to begin phase two negotiations.

"China may require the removal of existing tariffs imposed by the US as a prerequisite to the beginning of phase two trade talks," Dong said, urging the US to show sincerity and refrain from disturbing future talks.