BEIJING — China is counting on promises of big purchases of U.S. semiconductors and other goods to ease trade tensions and persuade President Donald Trump to extend a tariff truce and later resolve the market-rattling dispute directly with Chinese leader Xi Jinping.
During this week’s negotiations, which marked their fourth day Thursday, U.S. and Chinese officials have remained deadlocked on a number of issues underlying the current trade dispute, according to people with knowledge of the matter. These include Washington’s complaints that China pressures U.S. firms to share technology and uses industrial policies to favor domestic companies at the expense of U.S. competitors.
Having denied those allegations, Chinese officials are focusing instead on ways to boost U.S. exports to China. For instance, China’s top economic-planning agency is proposing to increase U.S. semiconductor sales to China to a total over six years of $200 billion, according to U.S. companies briefed on the plan, or a level five times that of current exports. Under the proposal, however, that increase would be generated in part by moving assembly operations of U.S. semiconductors from third countries like Mexico and Malaysia to China, allowing those products to be counted as U.S. exports rather than those of other countries.
Chinese negotiators are also offering to eliminate a national vehicle-procurement policy that has given consumers subsidies to buy domestically made new-energy, small-engine and other types of cars, the people with knowledge of the talks said. These proposals come on top of recent pledges Beijing has made to significantly increase China’s purchases of U.S. farm and energy products, including soybeans, liquefied natural gas and crude oil. Trump, who has campaigned on cutting the bilateral trade deficit, praised the soybean pledge late last month in the Oval Office.
An expanded version of this report appears on WSJ.com.
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