Commerce Secretary Wilbur Ross says China 'agreed to the concept' of reducing the trade deficit; Chinese vice premier visit up in the air

  • Commerce Secretary Wilbur Ross said China appears open to some of the White House's requests.
  • "I think they agreed to the concept of a trade deficit reduction," Ross said.
  • The U.S. requested the majority of China's deficit reduction come from purchases of U.S. goods — an idea Ross reiterated Thursday.
China's weakened investment and increasing corporate and local government defaults may be President Xi Jinping's most difficult issue since he became the country’s top leader in 2013.
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China's weakened investment and increasing corporate and local government defaults may be President Xi Jinping's most difficult issue since he became the country’s top leader in 2013.

On the heels of a last-minute trade summit in Beijing and in advance of the potential implementation of new tariffs, Commerce Secretary Wilbur Ross said talks with China have made progress, and the country appears open to some of the White House's requests.

"I think they agreed to the concept of a trade deficit reduction — the questions are how much and how do you get there?" Ross told the audience at CNBC's Capital Exchange breakfast on Thursday in Washington.

Among the negotiating principles laid out by the U.S. delegation was a request for China to reduce its trade deficit with the U.S. by $200 billion in the next two years. According to a document obtained by CNBC, the U.S. requested the majority of China's deficit reduction come from purchases of U.S. goods — an idea Ross reiterated Thursday.

"Our approach has been to request individual products on which we could sell more to them than we are selling now, as opposed to them selling us less," Ross said. "Us selling more to them has more bang for the buck for our economy."

China's Vice Premier Liu He is expected to visit Washington to continue negotiations before key deadlines approach later this month. On Monday, Press Secretary Sarah Huckabee Sanders announced the visit would take place the week of May 14-18.

"China's top economic advisor, the vice premier, will be coming here next week to continue the discussions with the President's economic team, and we'll keep you posted as discussions are ongoing," she said.

One potential wrinkle to a settlement happening in short order: The timing of the vice premier's visit appears to be in flux. Asked later Thursday morning about the official's visit, Ross told CNBC the date of the vice premier's arrival is unclear and "there's a chance it's not next week."

It's unclear whether the holdup is due to scheduling or the negotiations. A Commerce Department spokesperson reiterated that "discussions of timing are ongoing."

The week of May 21 features White House-imposed deadlines related to the tariffs announced two months earlier that could run the risk of heightening the anti-China rhetoric and derailing discussions.

After May 22, the U.S. Trade Representative can, by law, implement the tariffs on $50 billion in products it outlined in late March. By May 22, the Treasury Department must weigh in whether further Chinese investment restrictions are warranted.

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