Chinese publication warns that trade deal with U.S. is in serious question

The Chinese government has signaled through a state-run media publication that a prospective trade deal with the United States is "very much up in the air." 

China Daily, an English-language newspaper that Chinese leaders often use as a microphone, published an editorial late Saturday warning that the trade talks have a long way to go.

The warning puts a dent in some of the happy talk coming out of President TrumpDonald John TrumpDavid Axelrod after Ginsburg cancer treatment: Supreme Court vacancy could 'tear this country apart' EU says it will 'respond in kind' if US slaps tariffs on France Ginsburg again leaves Supreme Court with an uncertain future MORE’s meeting with Chinese President Xi Jinping at the Group of 20 (G-20) summit in Osaka, Japan, this weekend.

“Even though Washington agreed to postpone levying additional tariffs on Chinese goods to make way for negotiations, and Trump even hinted at putting off decisions on Huawei until the end of negotiations, things are still very much up in the air,” China Daily wrote, Reuters first reported.

The state-allied publication poured some water on Treasury Secretary Steven MnuchinSteven Terner MnuchinThe Hill's Morning Report: How will Trump be received at G-7? White House won't move forward with billions in foreign aid cuts Trump says he'll decide on foreign aid cuts within a week MORE’s optimistic assessment last week that China and the United States are 90 percent of the way to a deal, which some GOP lawmakers on Capitol Hill took as an encouraging sign.

“Agreement on 90 percent of the issues has proved not to be enough, and with the remaining 10 percent where their fundamental differences reside, it is not going to be easy to reach a 100-percent consensus, since at this point, they remain widely apart even on the conceptual level,” China Daily wrote.

Trump extended a significant concession to Xi at the G-20 by offering to ease sanctions on Huawei, the Chinese telecommunications giant that is closely linked to the Chinese government and suspected of harboring plans to engage in espionage.

Trump said Huawei can resume buying U.S. high-tech goods but kept in place restrictions on sensitive technologies that could impact national security.

Senior White House economic adviser Larry KudlowLawrence (Larry) Alan KudlowMORE on Sunday said U.S. and Chinese officials have agreed to resume talks but not put a time goal in place, a sign that progress between the two powers over the weekend was limited.

“The teams are going to start negotiating in earnest, Ambassador Lighthizer, Secretary Mnuchin and others,” he said on CBS’s “Face the Nation,” referring to U.S. Trade Representative Robert LighthizerRobert (Bob) Emmet LighthizerOn The Money: Economy adds 164K jobs in July | Trump signs two-year budget deal, but border showdown looms | US, EU strike deal on beef exports Chinese, US negotiators fine-tuning details of trade agreement: report The Trump economy keeps roaring ahead MORE.

Kudlow admitted the administration has received little in the way of promises from Beijing about what it might accept.

“We have no assurances, and, again, the president himself said several times, we want quality talks. There is no timeline here. The issue is quality, not speed,” he said.

Kudlow also noted that Chinese trade negotiators backtracked from previous concessions in May.

“They did pull back from some agreements we thought we had, and ... that also includes all manner of enforcement to whatever conditions were made,” he said.

Trump on Wednesday warned that he is ready to increase tariffs on another $300 billion in Chinese imports but said he might impose a 10 percent levy instead of the 25 percent tax he initially threatened.

Trump on Saturday said he would hold off on the new tariffs for the “time being.”

“We’re going to work with China where we left off,” he said.

Trump increased tariffs on $200 billion of Chinese goods from 10 percent to 25 percent on May 9, sending the U.S. stock markets dropping.

The U.S. now has tariffs on $250 billion in Chinese imports.