Investors should not expect any breakthrough in the trade talks between the United States and China currently under way in the Swiss city of Geneva.
Negotiations on Saturday lasted over 10 hours and officials yesterday hinted that the weekend talks may be extended by a day.
It would be naive to expect any resolution, as the two superpowers remain embroiled in a wide range of trade and economic disputes.
After US President Donald Trump launched his “Liberation Day” reciprocal tariffs on about 90 countries, Washington and Beijing have slapped steep tariffs and counter tariffs on one another. This shows that neither side is willing to back down.
But the United States and the United Kingdom have now reached an agreement on bilateral trade and Trump has said he will soon clinch trade pacts with other countries, with India closing in on a trade deal.
This indicates that after launching his reciprocal tariffs, Trump is starting to see some progress, and it will lead him to believe that his policies are succeeding.
As a result, he is unlikely to make significant concessions on trade with China.
Meanwhile, President Xi Jinping and Russian President Vladimir Putin said they would join hands to confront Western hegemony, during a state visit by the Chinese leader to Moscow last week.
In fact, both Beijing and Moscow said Trump’s tariffs are nothing short of bullying.
This suggests that China is not willing to make significant concessions in the trade war and is unlikely to compromise in the battle of trade tariffs, at least for now.
As neither side has shown they are willing to make concessions, how could they possibly reach a consensus on trade disputes in the near future?
Andrew Wong is a veteran independent commentator
