US and China recount contrasting versions of talks on trade deal

BEIJING/WASHINGTON — U.S. and Chinese officials emerged from trade talks Friday citing different expectations of the outcome as the two countries work to carry out their phase one deal.

The telephone conference, the first official bilateral trade talks since the coronavirus pandemic was declared, comes as Washington blames China directly for the spread of COVID-19.

Chinese negotiators, led by Vice Premier Liu He, discussed implementation of the initial trade deal with their American counterparts. Afterward, China issued a notice saying the two sides agreed to “create a favorable atmosphere and conditions” for carrying out the deal “and strive for positive outcomes.”

But the American team, headed by U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, said the two parties agreed that “in spite of the current global health emergency, both countries fully expect to meet their obligations under the agreement in a timely manner.”

Beijing’s wording suggests that China is underscoring the importance of better relations between the two powers. In recent weeks, U.S. Secretary of State Mike Pompeo has repeatedly criticized China over its handling of the epidemic. In an interview Sunday, Pompeo made allegations tying the origin of the virus to a lab in Wuhan.

China appears to be countering the condemnations over the coronavirus by outlining the need for improved relations to follow through with the phase one deal.

“If the U.S. continues with the criticisms, the foundation of confidence between the U.S. and China will crumble,” said a Chinese source familiar with the bilateral talks. “If things go past the critical point, it may reverberate on the future implementation of the trade agreement.”

Under the phase one agreement, which took effect in February, China is to import $200 billion more in American goods over two years. In return, Washington would cut tariffs on China in stages. Both sides are to update each other regularly on progress.

The trade representative did not specify time frames for China to meet its obligation, which suggests some leeway for a potential delay.

The agreement calls for expanded trade using 2017 as the base year. But farm exports to China are down 45% in the first quarter this year compared with the same period in 2017, U.S. Department of Agriculture data shows.

China has said it tripled imports of American soybeans by value during the first three months compared with January-March 2019. But soybean imports remain just half compared with the first quarter of 2017.

Overall imports from the U.S. have undershot year-earlier figures for two straight months through April, Chinese official trade data released Thursday shows.

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