Signs of progress between the superpowers come after weeks of turmoil on global markets, which were battered by the Trump administration’s threat to lift tariffs on $US200 billion ($280 billion) of Chinese imports to the US from 10 per cent to 25 per cent.
That threat was put on hold after a meeting between Mr Trump and Chinese President Xi Jinping in Argentina on December 1, when both sides agreed to a 90-day negotiation.
This week’s talks suggest renewed resolve to crack a deal amid signs growth is slowing in the US and concerns about China’s stock market and outlook for 2019.
The appearance of Mr Xi’s top economic advisor, vice premier Liu He, at the talks this week added to the positive mood, and many analysts anticipate there will be cabinet-level discussions later this month.
Steven Winberg, assistant secretary for fossil energy at the US Department of Energy, told reporters at the US delegation’s hotel that talks, which began on Monday, had gone well.
“I confirm we’re continuing tomorrow, yes,” Winberg told reporters, declining to answer further questions.
Chinese authorities have indicated they will release a statement after this week’s talks conclude.
A spokeswoman for the US Trade Representative’s office, which is leading the US negotiating team, also said talks would continue on Wednesday and “a statement will likely follow then”.
The US team, led by deputy US trade representative Jeffrey Gerrish, includes under secretaries from the Departments of Agriculture, Commerce, Energy and Treasury, and senior officials from those agencies and the White House.
Trump imposed import tariffs on hundreds of billions of dollars of Chinese goods last year and threatened more to pressure Beijing to change its practices on issues ranging from industrial subsidies to intellectual property and hacking. China has retaliated with tariffs of its own.
A sticking point for the Trump administration is finding methods of ensuring Beijing sticks to its pledges, theWSJreported.
This includes ensuring China won’t hinder US companies from gaining access to China’s market.
The first face-to-face negotiations between top officials since the dinner in Argentina could take place ater this month at the World Economic Forum in Davos, Switzerland.
Mr Trump, and his top trade and economic advisors, will attend the forum.The South China Morning Postreported that Mr Trump and Chinese vice president Wang Qishan may meet. Wang is due to deliver a keynote speech at the event.
Negotiations come as Mr Xi face a central dilemma in keeping China’s economic expansion going, according to Kevin Rudd, president of the Asia Society.
“He’s got a bunch of advisors around him saying the only way to grow the economy further is to give greater space, freedom, latitude, and incentive to the Chinese private sector,” Mr Rudd told Bloomberg TV in an interview. “That’s what Chinese entrepreneurs are calling for below the radar.”
“On the other hand you have a Chinese leader who has been trying to reassert the control of the Chinese Communist Party right across the fabric of Chinese business as well.”
If China’s private sector “goes on strike” by slashing investment, Mr Xi will be forced to pump additional fiscal and monetary stimulus into the economy, he said.
“Will it work in keeping growth above 6 per cent, I think it’s going to be very, very tough,” Mr Rudd said.