President Trump on Wednesday embraced an optimistic statement from the Chinese Ministry of Commerce as evidence of success in talks with Beijing about resolving the nations' trade conflict.
Trump wrote on Twitter that China was sending “very strong signals” and that he believed the country would follow through on a meeting held on the sidelines of the Group of 20 summit in Buenos Aires last week.
The tweet came after China released a conciliatory statement Tuesday evening after U.S. markets plunged amid growing fears that the expectations for an economic truce that seemed to flow from the G-20 summit were misplaced. After Trump indicated that China had made certain promises, his aides backtracked, and Trump himself had turned to more bellicose rhetoric on Monday and Tuesday, declaring that he would seek stiff tariffs for China if it did not follow through.
But on Tuesday evening in Washington — Wednesday morning in Beijing — the Chinese Ministry of Commerce painted a positive picture, saying that the Buenos Aires meeting was “very successful” and that the two countries would seek within 90 days to formulate a more specific deal, meeting Trump’s stated deadline.
“The economic and trade teams will actively push forward with negotiations, in accordance with a clear timetable and route map, within 90 days,” the spokesman said, according to a statement published on the ministry’s website. “The Chinese side will start implementing the specific items both sides have agreed on, and the sooner the better. ”
The statement did not reference other claims Trump had made about what China might do as part of a deal, including purchases of U.S. agriculture products and liquefied natural gas, nor his expectation that China would reduce or eliminate tariffs on U.S.-manufactured cars.
The words of confidence from the Commerce Ministry seemed to slightly steady the otherwise turbulent Chinese stock markets, sparing them the deep plunges that rattled Wall Street. Hong Kong’s Hang Seng Index closed down 1.6 percent, and the Shanghai Composite Index fared better, down 0.6 percent at close.
U.S. markets were closed Wednesday in honor of the funeral of former president George H.W. Bush.
The Dow Jones industrial average plummeted nearly 800 points, or 3.1 percent, Tuesday, to close at 25,027. The Standard & Poor’s 500-stock index fell 3.2 percent, and the tech-heavy Nasdaq gave up 3.8 percent.
The back-and-forth between the United States and China since Saturday’s meeting left a nebulous picture of the state of negotiations — and that will bear on markets in the months to come, said David Dollar, a senior fellow at the Brookings Institution who was the U.S. Treasury’s economic and financial emissary to China between 2009 and 2013.
The lack of a prepared, joint statement from both countries suggests that neither government is sure of what’s to come, Dollar said, although the crisis seems to have been staved off a little while longer.
“We avoided a bad outcome, but it’s not really clear how good an outcome there’s going to be,” Dollar said. “I think China’s been pretty clear about what they’re willing to do and what they’re not willing to do. Now it’s a question of whether the Trump administration is willing to take the deal that’s on the table.”