US-China relations could get better despite trade tensions, analysts say
- Chinese President Xi Jinping and U.S. President Donald Trump agreed on Saturday to proceed with trade negotiations, after talks took a turn for the worse in early May.
- Beijing, for its part, has taken a tougher stance against the U.S. in the last several weeks, and threatened the release of its own version of a blacklist.
- Critics say Beijing has not followed through on promises made when China joined the World Trade Organization in 2001, and that efforts to open up its economy to foreign companies have come far too slowly.
DALIAN — The U.S. and China are headed for greater cooperation, even if the ongoing trade dispute takes years to resolve, some analysts said Monday.
"I think we're really in for a process that might take three or four years," Timothy Stratford, chairman of the American Chamber of Commerce in Beijing, told CNBC's Geoff Cutmore during a panel Monday at the World Economic Forum in Dalian, China.
"I'm more optimistic on the mid term, that both governments and both countries will move into a better situation," said Stratford, who is also a partner at Covington & Burling and a former Assistant United States Trade Representative.
Chinese President Xi Jinping and U.S. President Donald Trump agreed on Saturday to proceed with trade negotiations, after talks took a turn for the worse in early May. Trump said the U.S. would hold off on new tariffs on Chinese goods, and that he would consider allowing American companies to sell to Chinese telecommunications giant Huawei, which the U.S. put on an effective blacklist in May.
Beijing, for its part, has taken a tougher stance against the U.S. in the last several weeks, and threatened the release of its own version of a blacklist.
"In restarting the trade talks, (there's a) new starting point, a greater common understanding," Wei Jianguo, a former vice minister at China's Ministry of Commerce, said Monday in a Mandarin-language phone interview, translated by CNBC.
"I think it will be resolved very quickly," Wei said, but he declined to give a specific time frame. He is now vice chairman and deputy executive officer at Beijing-based think tank China Center for International Economic Exchanges.
It's not clear whether the temporary truce will lead to an agreement, especially since significant policy issues remain points of contention between the world's two largest economies. For Americans focused on next year's presidential election, the call to put pressure on China and its technological development has grown louder from both political parties.
"The problem is, if China does not accelerate and continue to open and reform, that's going to unite all the factions in the United States," Charles Li, chief executive of Hong Kong Exchanges, said at Monday's World Economic Forum panel.
Critics say Beijing has not followed through on promises made when China joined the World Trade Organization in 2001, and that efforts to open up its economy to foreign companies have come far too slowly.
"You cannot do major global reforms out of the WTO," Yi Xiaozhun, deputy director-general of the World Trade Organization, said at Monday's panel. "So that's why we encourage all our members, including the big guys, to have dialogue, to take serious action on reform."
On Sunday, the Chinese government announced it would remove some restrictions for foreign investment in industries such as petroleum and gas exploration, mining and agriculture. Beijing also released a new list of areas in which foreign investment is encouraged, including data network hardware and cloud computing, according to state news agency Xinhua.
Authorities rushed to pass a new foreign investment law in March, which takes effect at the start of the new year and claims to improve protection of intellectual property and prohibit forced technology transfer.
"In the structural demands, we have seen some ... developments in China independent of the trade talks that run positive for the future," Nick Marro, Hong Kong-based analyst at The Economist Intelligence Unit, said in a phone interview with CNBC. He noted, however, that there is now increased scrutiny from both the U.S. and Beijing on access to each other's technology, and that the events of the last few months will only accelerate China's own development in that area.
It's not clear how close the two countries are going to get to returning to the more amicable relationship of past years, Marro said, adding that he expects trade tensions to resurface in a year.
— Reuters contributed to this report.