U.S.-China Trade Talks Back On, But Obstacles Remain

President Donald Trump and President Xi Jinping of China managed to get trade talks back on track this past weekend, but an even tougher job lies ahead – appeasing hard-line factions within their own governments demanding they give no quarter, The Wall Street Journal reported.

The Chinese leader faces party leaders and executives of state-owned enterprises who believe Washington is out to demolish the government-led economic model that is responsible for China’s emergence as a global power and U.S. rival.

Trump, for his part, faces skepticism from some Republican and Democratic lawmakers who worry he will give up too much in any deal, as well as wariness among some of his own appointees. Heading into an election year, Trump must also contend with restiveness among his supporters in the business community and farm-belt states who have been hit by the tariffs imposed by both countries, the Journal adds.

Simply relaunching the talks, which had been on hold since hitting an impasse two months ago, took a lot of negotiating. In return for getting China back to the bargaining table, Trump agreed to hold off on new tariffs on $300 billion in Chinese imports, and China agreed to buy more U.S. farm goods.

But a U.S. concession on Chinese telecommunications giant Huawei emerged as a key bargaining chip, one that illustrates the difficult decisions ahead, according to the Journal.

Trump said his move to let Huawei buy high-tech equipment from the U.S., worked out on the sidelines of a meeting of the Group of 20 leading economies here, would only apply to parts that don’t affect U.S. national security. A Commerce Department bureau is working to tailor export licensing “with particular scrutiny of the threat that Huawei poses to our broadband networks, which are crucial to national security,” an administration official said.

But Trump faced immediate pushback from China hawks in Congress. Sen. Marco Rubio (R., Fla.) warned via Twitter that any concession on Huawei “will destroy the credibility” of the administration.

Even within the administration, there are deep concerns in the national-security establishment about taking the heat off Huawei, which U.S. officials said was built on a foundation of stolen Western technology and is now building wireless networks that could be tapped by the Chinese government. Huawei has forcefully denied these allegations.

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