China has recommitted to $200 billion trade deal, Pompeo says after secret talks in Hawaii

Concerns had been growing that a sharp drop in oil prices and the pandemic would sink the trade deal, the only active area of cooperation between the two nations.

US secretary of state Mike Pompeo | Photo: Flickr

Washington: U.S. Secretary of State Michael Pompeo said China’s top foreign policy official committed in a meeting this week to honor all of his nation’s commitments under its first-phase trade deal with President Donald Trump.

“During my meeting with CCP Politburo Member Yang Jiechi, he recommitted to completing and honoring all of the obligations of Phase 1 of the trade deal between our two countries,” Pompeo said in a tweet on Thursday, using an acronym for the Chinese Communist Party.

It was the first substantive news out of Pompeo’s secretive meeting with Yang at Hickam Air Force Base in Hawaii on Wednesday. Concerns had been growing that a sharp drop in oil prices and effects of the coronavirus pandemic would sink the Jan. 15 trade deal, under which China committed to buy an extra $200 billion of U.S. goods over two years. Trump at one point threatened to “terminate” the agreement.

Pompeo offered no details beyond the tweet, which came at a moment when U.S.-China trade talks have taken on added political implications. In a book due out next week, former National Security Advisor John Bolton claims that Trump directly linked the earlier trade talks to his re-election chances, asking Chinese President Xi Jinping during a 2019 meeting to buy more American farm goods and saying it would help him win in 2020.

In a phone call with reporters later on Thursday, Assistant Secretary of State for East Asia David Stilwell said there were a range of issues on the table, ranging from trade to the coronavirus outbreak to North Korea’s nuclear program. Asked if progress had been made in the talks, Stilwell responded, “I’ll refrain from characterizing it that way.”

It was not Ambassador Lighthizer’s fault (yesterday in Committee) in that perhaps I didn’t make myself clear, but the U.S. certainly does maintain a policy option, under various conditions, of a complete decoupling from China. Thank you!

— Donald J. Trump (@realDonaldTrump) June 18, 2020

“The relationship needs to be more reciprocal and we raised quite a few of these issues and I’ll leave it you to determine whether they’re going to comply or not,” Stilwell said. He also declined to say how the meeting came about or who had asked for it. Both sides have said the other initiated the meeting.

“I’m proud to be part of a diplomatic tradition where we don’t feel the need to kiss and tell,” Stilwell said.

In an earlier readout from the talks, State Department spokeswoman Morgan Ortagus said the U.S. stressed the need for full transparency and information-sharing during the global Covid-19 pandemic and future outbreaks. The Wednesday meeting was the first time the two diplomats had met since August 2019, although they had spoken by telephone since then.

Worsening Strains

The meeting came amid a worsening strain in relations between the world’s two largest economies, with clashes on issues from the handling of the coronavirus to human rights and Hong Kong. Trump even tweeted on Thursday that “decoupling” the U.S. economy from China was a viable policy option.

The Chinese statement said the two men discussed Hong Kong, Taiwan and the situation of Muslim Uighurs in the far western region of Xinjiang.

Bolton says in his book that Trump encouraged Xi in 2019 to proceed with his program of confining Uighurs in what China portrayed as rehabilitation and training camps. But on Wednesday Trump signed legislation calling for punishment of Chinese officials for imprisoning more than one million Muslims.

Trump and Pompeo have blamed China for the global coronavirus pandemic, which first appeared in the mainland city of Wuhan, and the U.S. has threatened to revoke Hong Kong’s special trading status over concerns that China is seeking to erode the former British colony’s political autonomy.

The trade deal signed in January is the only active area of cooperation between the two nations, but Chinese purchases of agricultural goods are well behind where they need to be to meet its promises and the global recession is damaging trade generally.- Bloomberg