The US government would escalate tariffs on Chinese goods if the deadline is missed, the White House has said, adding only a meeting between Mr Trump and China President Xi Jinping will solve the trade deadlock. Both the US and China have imposed more and more tariffs on billions of dollars worth of each other’s goods over the last year and America has signalled it is prepared to increase duties to 25 percent from 10 percent if a deal can not be reached. Talks between US and Chinese representatives in Beijing are believed to be progressing well as the two countries try to hammer out a last minute deal to end the tit-for-tat tariff battle.
Mr Trump has indicated he is flexible to the March 1 deadline, suggesting he would let the date “slide for a little while” if a deal was in sight but would prefer not to do so.
However £155billion ($200billion) worth of Chinese imports are due to be hit by the two-and-a-half fold tariff increase if Washington and Beijing fail to reach an agreement.
Today, US department of agriculture deputy secretary Stephen Censky said Mr Trump and President Xi are expected to meet “some time in March”, a further suggestion the US is views March 1 as a soft deadline.
White House press secretary Sarah Sanders said Mr Trump’s private Mar-a-Lago retreat in Florida would make a good venue for the two presidents to thrash out final talks before putting pen to paper on a deal to avoid the tariff spike.
Mrs Sanders said: “We’ll see what happens on whether or not the president makes a move to change the deadline.
“It will ultimately take … President Trump and President Xi sitting down face-to-face figuring that out and getting that final deal because they are the only two that will ultimately be able to nail that down.”
Businesses in both countries fear being hit by the significant extra costs in sectors ranging from consumer electronics to agriculture.
US Treasury secretary Steven Mnuchin told reporters in the Chinese capital that talks were going well.
Mr Mnuchin is heading the US delegation along with trade representative Robert Lighter and the pair are expected to meet China’s vice premier Liu He in Beijing tomorrow and Friday.
Mr Liu is the top economic adviser to President Xi.
Investment banker Mr Mnuchin said “so far, so good” when asked how the trade pact talks were going but refused to comment on who he had been meeting with.
US stocks surged in response to the optimistic remarks.
Officials are currently trying to work out technical details in the deal including a mechanism for enforcing a proposed trade agreement.
James Green, a senior research fellow at Georgetown University who was America’s top trade representative at the US embassy in Beijing until last year, believes China wants a Trump-Xi summit to lockdown a deal and avoid the huge tariff increase.
Mr Green said if a deal is agreed then China will feel as if they have “dodged a bullet” however America might not view it as an end to trade friction.
He added: ”I think that whatever we might get for an agreement, it will be a pause, because the US government is still going to move forward in the telecoms sector, on law enforcement and legal action, and on sanctions-related issues.”