The trade deal U.S. negotiators are seeking will have some teeth in case China goes back on its trade promises, as it has in the past, The New York Times reported.
A top priority for Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer, who are set to hold talks this week with Vice Premier Liu He, is to put in place an automatic tariff mechanism that would raise duties on Chinese goods if its exports to the U.S. keep rising, The New York Times reported on Tuesday, citing three people with detailed knowledge of the negotiations.
China has a history of not living up to its trade obligations. When China joined the World Trade Organization in 2001, it made a promise to allow foreigners to access its banking and telecommunication markets. However, to this day, it hasn't let any foreign company step in. American negotiators want to make sure China will face some punishment if it repeats this behavior.