INSUBCONTINENT EXCLUSIVE:
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Can the US and China bridge their divisions
Top trade officials
from the US and China are meeting in Washington as a deadline to strike a deal approaches.This is the second round of talks since Presidents
Donald Trump and Xi Jinping met in Argentina last year and agreed to negotiate in the hope of defusing an escalating tariff war.There is
widespread scepticism that the two sides can reach a substantive deal by the 1 March deadline.Recent charges against Huawei have added to
the complications.At a press conference this week, Treasury Secretary Steven Mnuchin and White House economic adviser Larry Kudlow made few
promises."Let me just remind people, we do have another 30 days after this so my expectation is we'll make significant progress at these
meetings, but I would just emphasize these are complicated issues," Mr Mnuchin said
Last week, US Commerce Secretary Wilbur Ross said the two sides remained "miles and miles" apart.The Chinese delegation will be led by Vice
Premier Liu He, a close economic adviser of Mr Xi, and central bank governor Yi Gang.They will meet with the US Trade Representative Robert
Lighthizer and White House trade advisor Peter Navarro.What is the fight aboutMr Trump has long blamed China's rise as an exporter for a
loss of manufacturing and other jobs in the US
But the issues facing the two countries are broader than the trade deficit.The US is pressing China to make changes to its economic
policies, which it says unfairly favour domestic companies through subsidies and other support.It has also accused the government of
supporting technology theft as part of its broader development strategy
Where do the two countries stand nowThe US imposed tariffs on $250bn worth of Chinese goods last year
China retaliated in kind, hitting $110bn of US products with duties.The moves rattled financial markets and contributed to worries about
economic slowdown in both countries, especially in China.That has generated pressure for a deal, but it remains uncertain if the two sides
will be able to overcome their differences.Chinese officials are resistant to the wholesale changes sought by the US and the charges against
Huawei - one of China's biggest and most successful technology firms - have added to the political tensions.Meanwhile, Mr Trump, a
self-described "Tariff Man", rejected a previous proposal from Beijing to resolve the dispute with increased purchases of US goods.China has
reportedly expanded that offer in recent weeks
And at times, Mr Trump has seemed eager to assure the public that an agreement remains within reach.It would make "so much sense" for China
to "finally do a Real Deal", he wrote on Twitter this month.What happens nextIf the two sides cannot reach an agreement by 1 March, the US
has said it will increase the tariff rate from 10% to 25% on Chinese goods worth an estimated $200bn.Mr Trump has also threatened tariffs on
an additional $267bn worth of products.With White House advisors reportedly divided, the focus is on Mr Trump, who is scheduled to meet with
Mr Liu in Washington this week as part of the talks
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Economists worry the tariffs will hurt global trade
Mr Trump may decide
a deal would boost his political standing after a bruising fight with Democrats over border wall funding and the government shutdown
But he could also hope to shore up his base with protectionism.Analysts at Capital Economics said: "We think the two countries may just be
able to reach a face-saving agreement to tide them over in the short term and avoid an escalation." For now, odds favour the limited truce
