Trade war back on with China?

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Fears of a trade war between the world's two biggest economies had also receded after the administration of President Donald Trump said it had reached a deal that would put ZTE Corp back in business after banning China's second-biggest telecoms equipment maker from buying USA technology parts.

A joint statement released by China and the USA on May 19 declared that there was "a consensus" on reducing the goods trade deficit, and that "both sides agreed to continue to engage at high levels on these issues and to seek to resolve their economic and trade concerns in a proactive manner".

As President Trump said we lost the trade war long ago...

China and the USA averted a trade war by reaching an agreement on May 20 under which Beijing agreed to "significantly increase" its purchases of American goods and services to reduce United States dollars 375 billion trade deficit with Washington. The latest move to announce the tariffs comes ahead of US Commerce Secretary Wilbur Ross's visit to China next month over the same.

FILE - U.S. Treasury Secretary Steven Mnuchin is seen as he and a U.S. delegation member for trade talks with China, leave a hotel in Beijing, China, May 3, 2018.

During the media briefing, the Foreign Ministry spokesperson also expressed concern over reports that the USA is planning to restrict visas of Chinese students studying advanced subjects like robotics, aviation and high-tech manufacturing to one year.

The China Daily newspaper said the repeated US claim that Beijing had forced foreign firms to transfer their technologies to Chinese businesses was without evidence and was being used as an excuse to facilitate its trade protectionism. The two reportedly had an expletive-fueled shouting match in mid-May over Mnuchin's decision to talk with Chinese Vice Premier Liu He.

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China here on Wednesday urged the USA side to keep its promise on bilateral trade issues, and act in accordance with the spirit of recent joint statement. It used the threat of increased import levies to kick start negotiations with China on easing the pain for American companies.

The administration also said it would pursue a settlement over its dispute with China before the World Trade Organization regarding what it says were unfair technology licensing deals.

The latest talks focus on U.S. claims of intellectual property theft by China.

United States companies still fret that they will get caught in the crossfire of a trade war between the U.S. and China. China has already pledged to retaliate against the 25pc tariffs.

But that was before the USA said it will unveil new potential investment restrictions in the hi-technology sector by the end of June and start imposing tariffs as early as mid-June.

The US trade sanctions proposed in March include restrictions on Chinese investment, export controls and 25 percent tariffs on as much as $50 billion in Chinese tech goods.

A round of talks in Washington in May ended with a pledge by the Chinese to buy more U.S. agricultural and energy products, but few firm commitments.

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