Trump, Xi Signal Readiness for Trade Talks Ahead of G-20 Meeting

(Bloomberg) -- U.S. President Donald Trump and Chinese leader Xi Jinping have indicated they're both ready for a highly anticipated meeting at the Group of 20 summit in Argentina next week.

The world's biggest economies have been engaged in an escalating trade war that is starting to have a greater impact on financial markets and global growth. On Thursday, Trump told reporters that China wants to make a deal “very badly” after his administration placed tariffs on on about $200 billion worth of Chinese goods.

China “wants to make a deal and we're very happy with that,” Trump said. “I'm very prepared, I've been preparing for it all my life.”

On Friday in Beijing, top Chinese officials briefed on Xi's upcoming travels, including the Nov. 30-Dec. 1 G-20 in Buenos Aires where he'll meet with Trump. Xi's trip will include stops in Spain, Portugal, and Panama. They didn't name any officials who would accompany Xi.

Highlights from China's briefing:

• China “hopes the Xi-Trump meeting goes smoothly,” Vice Minister of Foreign Affairs Wang Chao said.
• China hopes to meet the U.S. halfway in addressing trade issues, Vice Minister of Commerce Wang Shouwen said. “Chinese and U.S. trade teams have been in close touch,” he said, echoing White House economic adviser Larry Kudlow's comments last week that they have resumed contact “at all levels.”
• Wang Shouwen appeared to echo Trump's line: “We noticed that the U.S. wants to reach an agreement to solve trade frictions with China. China hopes to work with the U.S. to contain disputes.” U.S. trade action hurts China, America and the world, he added.
• The briefing also included remarks from Vice Minister of Foreign Affairs Qin Gang, Assistant Minister of Foreign Affairs Zhang Jun, Vice Minister of Finance Zou Jiayi and central bank Deputy Governor Chen Yulu.

Key Comments on G-20

• Xi will attend a meeting of BRICS nations and hold bilateral summits with other leaders. China hopes to use the G-20 to reach a practical, open agreement on economic and trade cooperation, pushing all parties to improve policy coordination.
• China hopes to send a clear signal on supporting a multilateral system of trade and enhance cooperation with its trading partners.
• China is paying “close attention” to the summit and calls for all parties to uphold equality and mutual respect.
• The G-20 will agree to a 2020 deal on a digital economy.
• The bloc agrees the global economy faces downward pressure and rising risks, including a volatile finance market, trade frictions, and weak structural growth. The global economy lacks growth driver.
• China says reforms on the World Trade Organization should be addressed within the global trade body. Trump has repeatedly said the U.S. hasn't been treated fairly by the organization.
• China says unilateralism and protectionism cast a shadow on global trade.

Latin America

• China and Spain will chart a new road map for bilateral relations. China and Portugal will sign unspecified deals.
• China and Argentina will sign a five-year plan for future cooperation, and Beijing will support the country's efforts to stabilize its finances.
• China and Panama will sign agreements in the e-commerce sectors and the service trade, and a pact for infrastructure and energy cooperation.
• While some Latin American countries see rising challenges in an unstable global environment, cooperation between China and the continent won't change.

Insights

• As Trump scales back America's involvement in international trade agreements, Xi is using his signature Belt and Road trade and infrastructure program to position himself as a champion of global free trade. The initiative has extended into South America and the Caribbean, as Xi looks to expand China's influence in the region.
• Outside of talks with Trump, this trip is a chance for China to bolster ties after its lending practices to poor countries -- including Ecuador and Venezuela -- fueled concerns that they would become saddled by debt. U.S. Vice President Mike Pence warned countries to avoid becoming indebted to Beijing in a speech last week at APEC in Papua New Guinea.

To contact Bloomberg News staff for this story: Miao Han in Beijing at mhan22@bloomberg.net;Dandan Li in Beijing at dli395@bloomberg.net

To contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Karen Leigh, Daniel Ten Kate

©2018 Bloomberg L.P.

With assistance from Editorial Board