China Softens Tone on Trade After U.S. Leaves Empty Handed

China made an attempt to give a positive assessment of the U.S. trade talks after Donald Trump’s negotiators left Beijing Friday with no agreement on the horizon, while claiming that the U.S. shouldn’t make unreasonable demands, Bloomberg informed.

State media over the weekend gave a somewhat positive reaction of the U.S. trade talks, urging more negotiations while saying the Americans should be “rational and pragmatic.” And in a move that would meet some U.S. demands, the Commerce Ministry is reviewing measures to further decrease import tariffs on some food, pharmaceuticals and medical instruments, Economic Information Daily reported on Monday, citing unidentified sources.

“In the next couple of months, we expect continued negotiations will likely result in a scale-back of the current proposal on tariffs as China quickens its implementation of some announced opening and reform measures,” UBS Group AG chief China economist Wang Tao said in a note. “As a result, we expect any direct impact on exports and economic growth from higher tariffs will be limited.”

China is scheduled to report April trade data Tuesday. Possible U.S. trade measures may impact Chinese exports later this year, Jing Ulrich, Asia-Pacific Vice Chairman JPMorgan Chase & Co., said on Monday at a media briefing in Beijing.

Two days of discussions were completed Friday in Beijing with an agreement to keep the pace of the talks but little else, leaving the U.S. threat of tariffs on as much as $150 billion of Chinese imports still in play. The list of demands from each side, seen by Bloomberg News, proved just how wide the gulf between the world’s two biggest economies remains.

The U.S. wants China to reduce its annual trade surplus by $200 billion by the end of 2020 and not retaliate against U.S. tariffs. It also wants a stop to subsidies and other government support for its Made in China 2025 plan that targets global domination in strategic industries from robotics to new-energy vehicles.

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