China in Close Contact with U.S. on Trade, Urges Tariffs Cut

(Bloomberg) --

Chinese officials are in “close contact” with U.S. counterparts on trade negotiations, Ministry of Commerce spokesman Gao Feng said, while reiterating that tariffs should be reduced proportionately as part of a phase-one accord.

Gao declined to give further details on the talks at a regular briefing in Beijing on Thursday.

Stocks rose in Asia and Europe, and U.S. equity futures gained, as the world's two largest economies try to reach a truce in a 20-month-long trade war that's led to the largest volley of tariffs since the 1930s -- hitting some $500 billion in shipments going in both directions.

The U.S. has pledged to slap tariffs on more Chinese imports if a deal isn't struck by Dec. 15, and many economists are pinning forecasts for a global economic rebound next year on a cease-fire that avoids such an escalation.

President Donald Trump, speaking Wednesday at a meeting in London with German Chancellor Angela Merkel, said the discussions with China are going very well. “We will make a lot of progress,” he said. Almost eight weeks ago Trump announced the preliminary accord and predicted it would take three to five weeks to put on paper.

Read More: Decoding Trump's Trade Brain, Bluffs and Bluster

Despite heated rhetoric over issues including Hong Kong's protests and alleged human rights abuses in Xinjiang, negotiators are moving closer to agreeing on the amount of tariffs that would be rolled back in a phase-one trade deal, Bloomberg reported on Wednesday.

U.S. negotiators expect a phase-one deal with China to be completed before the mid-month deadline, people familiar with the matter said. Outstanding issues in the talks include how to guarantee China's purchases of U.S. agricultural goods and exactly which duties to roll back, they added.

To contact Bloomberg News staff for this story: Miao Han in Beijing at mhan22@bloomberg.net

To contact the editors responsible for this story: Jeffrey Black at jblack25@bloomberg.net, Daniel Ten Kate, Brendan Murray

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With assistance from Bloomberg