US-China trade deal may be delayed

An interim trade agreement between the US and China might not be completed in time for signing in Chile next month as expected but this does not mean that the accord is falling apart, a US administration official has said.

US president Donald Trump and Chinese president Xi Jinping were expected to sign ‘phase one’ of the agreement at next month’s Asia-Pacific Economic Co-operation summit in Chile, but the date is still fluid.

“If it’s not signed in Chile, that doesn’t mean that it falls apart. It just means that it’s not ready,” the administration official said.

“Our goal is to sign it in Chile. But sometimes texts aren’t ready. But good progress is being made and we expect to sign the agreement in Chile.”

Mr Trump, US Treasury Secretary Steven Mnuchin and White House economic adviser Larry Kudlow have all said good progress is being made on the deal after a nearly 16-month trade war, while also noting that it would be fine if the deal was not finalised by the APEC summit.

US stocks turned negative after reports of the administration official’s comments, as investors bet that the closely-watched trade talks were further away from resolution.

The South China Morning Post, citing a person briefed on the arrangements, reported that the leaders of the world’s two largest economies were tentatively slated to sign the interim trade deal on November 17 “if everything goes smoothly”.

However, the comments from the Trump administration official raised the possibility that the ‘phase one’ agreement might not be finalised in time for the APEC gathering.

Mr Trump on Monday said that he hoped to sign a significant part of a trade deal with China at the summit, but did not elaborate on the timing.

One US-based source familiar with the plans confirmed that November 17 was the likely date for the meeting.

However, an administration official said that Mr Trump had said he would “probably” sign the agreement in Chile.

White House adviser Jared Kushner said the US and China have come to an understanding on the direction of their trade relationship after a nearly 16-month trade war.

- Reuters