Mnuchin says trade talk with PBOC’s Yi Gang constructive

Osaka: US Treasury Secretary Steven Mnuchin tweeted that he had a ‘candid’ and ‘constructive’ talk on trade issues with People’s Bank of China Governor Yi Gang.

Mnuchin had earlier played down expectations for the meeting with Yi, which took place on the sidelines of a gathering of Group of 20 finance ministers and central bankers in Fukuoka, Japan.

He had foreshadowed that no big announcement was expected and that the ‘main progress’ would occur at a meeting between presidents Donald Trump and Xi Jinping at the G-20 leaders’ summit in Osaka at the end of the month.

Trade negotiations have been on hold since the US ramped up tariffs on Chinese imports last month, prompting a retaliatory move from China, after a breakdown in talks.

Mnuchin departs from the G-20 early evening Sunday and isn’t expected to make any further public statements on China trade talks.

During a briefing Saturday in Fukuoka, Mnuchin said “if they want to come back to the table and have a real agreement we will negotiate. If not, we’ll go forward with our plan” to impose more tariffs.

Asked about China’s currency on Saturday, he attributed its recent decline to market forces and the absence of intervention. “When you have intervention in a market for a long period of time and then they don’t intervene, the market could view that as a desire to have the currency weaken,” he said.

The Treasury Department issued its semi-annual foreign-exchange report to Congress last month, in which no country was named as a manipulator. China remains on its watch-list.

Breakdown

Mnuchin has said the trade talks broke down because Beijing reneged on provisions of a tentative deal. Trump raised tariffs on about $200 billion (Dh734 billion) in Chinese imports to 25 per cent in response, and at the time hung out the possibility of further action.

China has blamed the US for the breakdown and vowed to reciprocate for the increased tariffs in various ways. The country has hinted at cutting off the US supply of rare earth elements and is also hitting America’s education and tourist sector by announcing visa restrictions.

Trump has said he’ll decide whether to enact tariffs on another $325 billion in Chinese imports after the G-20 leaders’ summit in Osaka.

China’s Yi said in a Bloomberg interview on Friday that his meeting with Mnuchin would be a “productive talk, as always,” though the topic of the trade war would be “uncertain and difficult.”