China and U.S. Talk Trade Ahead of January Negotiations

China and the U.S. held vice-ministerial level talks on Wednesday to discuss the ongoing trade dispute as they move closer to meeting in January, Bloomberg reported.

The two sides spoke by phone according to China’s Ministry of Commerce, and have held several rounds of talks in recent weeks, Treasury Secretary Steven Mnuchin told Bloomberg on Tuesday in Washington. They plan to hold a formal, face-to-face meeting in January to negotiate a broader truce in their trade wars but are unlikely to meet in person before then, Mnuchin said.

“We’re in the process of confirming the logistics of several meetings and we’re determined to make sure that we use the time wisely, to try to resolve this,” Mnuchin said. Both sides are now focused on trying “to document an agreement” by a March 1 deadline for their current tariffs truce to run out. “We expect there will be meetings in January,” he said.

The two sides are planning to meet in January, according to Chinese officials with knowledge of the discussions who asked not to be named as the talks were private. China’s Ministry of Commerce didn’t respond to Bloomberg’s faxed request for comment.

According to Mnuchin, neither he nor President Donald Trump were aware of the arrest of a senior executive from Huawei Technologies Co. when they met with China’s Xi Jinping for dinner on December 1, the same day that the company’s chief financial officer was arrested in Canada.

The Treasury secretary also sought to play down the President’s declaration last week that he would be willing to intervene on Huawei’s behalf if it was necessary to help reach a trade deal between the world’s two largest economies. “We’ve been very clear and China understands that these are separate tracks,” Mnuchin said.

Mnuchin and the President had not had “any direct conversations’’ about the Huawei case, he said. He also declined to comment on whether the Treasury Department was preparing a broader case against the Chinese telecommunications-equipment provider, which has been accused by the U.S. of conspiring to violate U.S. sanctions against Iran, Bloomberg writes.

Hawks in the Trump administration have long raised questions about just how much the U.S. should trust any promises of economic reforms made by Xi given the experience of past administrations in dealing with Beijing. But Mnuchin said the two sides had agreed that any eventual deal would be “enforceable and verifiable and have specific dates on it.”

Reducing the trade deficit with China remained a major priority for Trump but Mnuchin said the administration understood it would take time and was also focused on securing structural changes in the Chinese economy that would help balance trade. The U.S.’s monthly trade deficit in goods with China hit a record in October and is on track to have expanded through the first two years of the Trump presidency.