China would face a deadline of 2025 to meet trade commitments, according to a report on Thursday by Bloomberg that cited anonymous sources familiar with the matter.
The US-China trade talks continue in Washington where China’s Vice Premier Liu He began planned meetings with American Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Wednesday.
Both sides aim to strike a deal on major issues over the next few days and Trump will meet Liu at the White House on Thursday, according to the report.
As the talks resumed on Wednesday morning, Trump’s top economic adviser touted progress but cautioned that a final deal to end the trade war remains elusive. Negotiators are “making good headway,” White House economic adviser Larry Kudlow told reporters at an event in Washington. “But we’re not there and we hope this week to get closer,” he said.
Under the proposed agreement, China would commit by 2025 to buy more American goods, including soybeans and energy products, and allow 100% foreign ownership for US companies operating in China as a binding pledge that can trigger retaliation from the US if left unfulfilled, the report quoted sources as saying.
There are also other non-binding pledges by China with a deadline of 2029, the report adds.
Whether or not the proposed agreement includes anything about forced technology transfer—a key issue between the two countries—remains unknown.
“The likelihood that the US and China will make some progress in the ongoing trade talks has increased as a result of mounting domestic pressure in both economies,” said Cailin Birch, Global Economist at The EIU. “Nonetheless, we do not expect a meaningful agreement, as the US and China enter into a strategic competition for economic—and particularly technological—dominance."
In addition, the two countries would need to talk about the US$360 billion of tariffs already imposed on each other’s goods in the past nine months.
According to the report, Trump’s suggestion is to leave at least some of the tariffs in place for a substantial period time to make sure China keeps its promises.
A meeting date between Trump and Xi could be announced as early as Thursday, the report says, adding that both American and Chinese officials are still discussing when the two leaders could sit down to sign the agreement.