USTR Denies White House Is Lowering Its Sights On China Trade Goals

President Trump signaled that he is ready to move towards trade peace with China in a tweet that lifted global stock markets. But while broad tariffs on Chinese imports brought Beijing to the negotiating table, the President has grown impatient with the talks, and a consensus is growing in Washington that he may ultimately accept a weaker deal than many in his administration had been hoping for.

However, the United States Trade Representative told lawmakers during testimony this week that he and his negotiators are maintaining a tough line with the Chinese, repeatedly using the word ‘if’ when talking about the potential for reaching a deal with Beijing.”

He also insisted that President Trump isn’t losing patience. “His instructions to me are: You have to get a great agreement. If we have no agreement, we’ll just wait until we can get a great agreement,” Mr. Lighthizer said.

American and Chinese negotiators have wrestled over trade terms in rounds of talks over the past year, including in Washington last week. Chinese negotiators have largely repackaged old promises about opening their markets to foreign companies and offered large purchases of American products that are designed to impress a President who is focused on reducing the bilateral trade deficit.

The Chinese have so far declined to make the concrete commitments to reform their economy that the administration has demanded, including ending China’s practice of subsidizing companies, engaging in cybertheft and forcing American companies to hand over intellectual property to Chinese partners in order to do business there.

President Trump continues to insist that any deal with China will end “unfair” trade practices, including any theft of American technology and intellectual property. Negotiators are also trying to insert an enforcement mechanism into any deal that would require China to return to the bargaining table if it fails to make these structural changes, a person familiar with the talks said.

But the hardened position that prompted the President’s unprecedented imposition of sweeping tariffs on Chinese goods appears to be weakening, giving Beijing more room to maneuver and undermining Mr. Lighthizer’s goal.

On Sunday, citing “substantial progress” in trade talks, President Trump backed off his March 1 deadline to impose higher tariffs on $200 billion worth of Chinese goods. That date had been described by Mr. Lighthizer in December as a “hard deadline” and was viewed as critical to getting Beijing to agree to significant changes since its economy, already hurting from tariffs, would suffer more from higher levies.

With the Chinese now making only vague concessions on structural reforms, Mr. Lighthizer would prefer to stay tough and let the bite of American tariffs persuade them to make bigger promises. While he has shared with Mr. Trump the view that the Chinese are not ready to make significant concessions, the President has continued to press for a deal.

“Bob Lighthizer has made it a priority to get this China deal right,” said Myron Brilliant, an executive vice president and the head of international affairs at the U.S. Chamber of Commerce. “He understands that this is the moment in time in which there’s an opportunity to make a real change in the trajectory of the U.S.-China relationship, and he’s focused on the bottom line: what he can get from the Chinese that will improve the U.S.-China economic relationship.” In trying to pin down the Chinese on making ambitious reforms to their economy, he has an unenviable task.