Washington’s chief trade negotiator on Wednesday said there remained much to do before reaching a new trade agreement with China, even though both sides signal their talks are nearing the finish line.
After months of negotiating with Beijing, ‘now we are making real progress,’ US Trade Representative Robert Lighthizer said in congressional testimony.
However, ‘much still needs to be done both before an agreement is reached, and more importantly after it is reached if one is reached.’
Lighthizer’s remarks underscored the remaining hurdles facing negotiators despite the apparent eagerness on both sides to bring their eight-month trade war to an end.
Citing ‘substantial progress,’ President Donald Trump on Sunday said he would postpone a sharp increase in US duties on $200 billion in Chinese imports while the two sides worked to reach an agreement.
Final details would be hashed out before a ‘signing summit’ with Chinese President Xi Jinping at an unspecified future date, Trump said.
Along with Japanese and European officials, the United States accuses China of entrenched unfair trade practices, including massive state intervention in markets, subsidies and the theft of foreign technology.
Chinese officials have offered to increase purchases of American farm goods and energy exports but it remains unclear whether Beijing will give in to US demands for fundamental changes in industrial policy, which analysts say could weaken the communist party’s power.
Lighthizer’s testimony coincided with other headline-grabbing appearances on Capitol Hill, with Federal Reserve Chairman Jerome Powell and former Trump attorney Michael Cohen also appearing.
But Lighthizer’s remark about the remaining work needed in the China negotiations helped send Wall Street lower, although stock prices had recovered some of those losses by mid-afternoon.
‘It’s part of the negotiating tactic. They don’t want to be seen as weak against China,’ said Adam Sarhan of 50 Park Investments told AFP, adding that investors were not unduly worried.
‘I don’t think the market is really taking that seriously. It is pulling back after a recent rally.’
Appearing before the House Ways and Means Committee – which writes tax laws – Lighthizer faced queries from about three dozen lawmakers from across the United States on broad array of matters under negotiation.
– ‘It’ll have layers’ -Lighthizer said he appreciated the hardships US exporters and importers have suffered in the trade war – a situation in which President Donald Trump had shown political ‘grit,’ he said.
According to media reports, however, Trump has grown impatient with Lighthizer as the talks have dragged on.
Unlike US trade skirmishes with Canada, Mexico, the European Union and other trade partners, Lighthizer’s reception by the committee showed support for the China confrontation from both Democrats and Republicans.
‘The fact that it’s bipartisan is why we’re making success,’ Lighthizer said.
American officials also say they are demanding that any agreement have teeth.
Lighthizer told lawmakers any agreement would be ‘specific, measured’ and provide for the ability to ‘proportion action unilaterally’ in the event that China failed to live up to its end of the bargain.
‘This enforcement process, if we have an agreement, and once again we don’t have an agreement, will be very specific,’ Lighthizer said, adding that grievances could be addressed at periodic US-China meetings.
‘It’ll have layers. It’ll have timeframes and there will be reaction.’
After exchanging punitive tariffs on more than $360 billion in total two-way trade, Trump and Xi declared a truce in December and agreed to hold off on further tariffs or retaliation for 90 days. 
The United States had been poised to more than double the tariffs on the most recent and largest round of Chinese exports on Saturday.
Analysts say the two sides are likely to trumpet mutual agreements to resolve the easier parts of the trade dispute – increasing purchases of American goods, more open investment in China and tougher protections for intellectual property and proprietary technology.
The harder parts covering issues like scaling back China’s ambitious industrial strategy for global preeminence, are another question.