CGTN Europe interviewed Jeff Moon, Former Assistant US Trade Representative for China
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00:00I'm going to give you a timeline. As we've heard from Li Yuanhua, the London meeting follows on from China-U.S. negotiations in Geneva on the 12th of May.
00:09Both sides agreed to pause their dispute for 90 days and reduce tariff tariffs. U.S. duties fell from 145% to 30%.
00:19China reduced its tariffs on U.S. goods from 125% to 10%.
00:25China also agreed to roll back the non-tariff measures it had imposed on April 2nd.
00:31That included export controls and anti-dumping probes into U.S. and sorghum.
00:37It's a type of grain, poultry, rare earth elements as well and some optical fibres.
00:44But on May 30th, President Trump accused China of violating the Geneva agreement,
00:49claiming Beijing had failed to remove non-tariff barriers as promised.
00:53China rejected this accusation.
00:56On the 2nd of June, the Commerce Ministry said all agreed measures had been suspended.
01:01Beijing also criticised the U.S. for imposing what it called discriminatory restrictions,
01:06targeting artificial intelligence chip exports, software sales and visas for Chinese students.
01:14Three days later, tension eats during a phone call between President Xi and President Trump.
01:20Both leaders reaffirmed their commitment to the Geneva consensus.
01:25President Xi urged Washington to reverse what he called negative policies toward China
01:30and to keep communication channels open to avoid misunderstandings.
01:34President Trump said Chinese students were welcome in the U.S.
01:37and reaffirmed America's commitment to the one-China principle.
01:43Jeff Moon is a former assistant U.S. trade representative for China.
01:47The phone conversation was crucial because apparently at the working level, there was a deadlock.
01:53There are a couple of good reasons for the leaders to talk, a couple of good reasons for them not to talk.
01:59But generally speaking, in U.S.-China relations, the two top leaders speak when they want to ratify
02:07something that has been decided below or when they want to clear out a deadlock.
02:11So there was clearly a deadlock. There was a misunderstanding over what was promised at Geneva on May the 12th.
02:19There were two things that were decided.
02:21One was to lower tariffs and the other one was to roll back retaliation.
02:26And exactly what was going to be rolled back with respect to rare earths was not clear to both sides.
02:32And I think that the leaders needed to talk about that and tell the negotiators to go back to the table with some renewed instructions.
02:38Now, global markets seem to be pinning their hopes on these talks.
02:44Can these negotiations get the two superpowers back on track?
02:48I think they'll definitely get back on track in terms of the bilateral negotiations.
02:55I don't think that any major decisions are going to be reached or announced.
02:59I think the major accomplishment of this meeting will be to come to some common agreement on what the rare earth terms were.
03:08The president's director of the National Economic Council was on U.S. TV within the last hour.
03:14And he said that the Trump administration is basically looking at a handshake.
03:18That's his word, not mine.
03:20A handshake understanding as to how we move forward on the rare earths issue.
03:26That means, practically speaking, we're probably not going to get a document.
03:30We may not even get a formal announcement.
03:33But at least to the extent that we're beyond this and moving on, that's positive.
03:38And by the way, we're into a three-month period, a pause period, and we've already wasted a month just talking about this,
03:46not even getting to the real issues between the two countries.
03:50So we really need to get beyond this and move on.
03:52Well, as you say, we're partway through that 90-day truce, reducing the new tariffs between the pair to 10%.
04:00So it is that handshake you speak of.
04:03Is that the best outcome we can hope for?
04:05And what could possibly go wrong?
04:08Well, that's all that the Trump administration says that they're looking for.
04:11They're not trying to memorialize anything, which would take a lot more time.
04:14What could go wrong is that, clearly, we could descend into a spiral down into retaliation.
04:24After there was this misunderstanding, let's call it, about rare earths,
04:28the United States announced various measures that could be interpreted as retaliation.
04:33And if we get into a retaliatory cycle, then that would be very negative for the bilateral negotiations and for world markets.
04:41And if we get into a retaliation, let's call it, about rare earths.