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RPT-MNI EXCLUSIVE: September China-US Meeting Likely:Advisors

By Wanxia Lin
     BEIJING (MNI) - A meeting between Chinese and U.S. trade negotiators is
likely to proceed this month, although expectations for progress should be
limited, government advisors told MNI.
     The latest round of tariff hikes by the two countries raised doubts over
whether the meeting in Washington would go ahead as scheduled. But Chen Wenling,
Chief Economist at the China Center for International Economic Exchanges, said
Vice Premier Liu He aims to "resolutely oppose trade war escalation" and that
while China will not concede its key principles, it wants to resolve disputes
     "China's retaliatory move aims to create a fair base for the talks, not to
fight tooth and nail," she said, comparing the current situation to that before
the 11th round of talks in May when Vice Premier Liu also headed to the U.S. to
put talks back on track. But, said Chen, whose high-level think tank falls under
the National Development and Reform Commission, the meetings could prove
fruitless unless the U.S. shows some flexibility.
     Yu Miaojie, a veteran trade expert advising several government departments,
said the two countries will likely meet, and "maybe in late-September". Talks
could focus on avoiding additional tariffs on CNY550 billion of Chinese products
which President Donald Trump plans to impose on Oct. 1 and Dec. 15.
     "It is still possible for the two sides to reach a preliminary deal in the
second half of November, or December," said Yu, who is also Deputy Dean of the
National School of Development at Peking University. The two heads of state
could meet during the APEC meeting in Santiago in mid-November, he said.
     Yet Yu remains pessimistic over Sino-U.S. relations in the long run. Any
deal "could turn into a worthless piece of paper, if Trump gets re-elected in
2021," said Yu.
     Both advisors think China should look beyond tariffs as reprisals to any
future U.S. increases, to measures including a "non-reliable" entity list, along
with the export restriction of rare earths.
     "China is ready to roll out the 'non-reliable' list to target American
companies anytime," said Chen, "if they are submissive to their state power to
curb supplies to Chinese enterprises." Yu thinks FedEx would be included on such
a list, if introduced.
     China should increase stockpiles, boost domestic production and increase
imports from Europe, Japan and South Korea to replace declining agriculture
imports from the U.S, Chen said.
--MNI London Bureau; +44 203 865 3829; email:
[TOPICS: M$A$$$,M$Q$$$,MT$$$$,MX$$$$,MGQ$$$]

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