Director of the National Economic Council Larry Kudlow says that he witnessed several things at the G20 conference that made him believe that the overtures made by the Chinese government on trade might actually happen this time.
Kudlow told members of the press Monday that he saw the relationship between President’s Trump and Xi and that it was authentic and means something.
“So I saw the chemistry between President Trump and President Xi. You know, we’ve been hearing that they’re friends and so forth. I actually saw it,” he said in a mid-day press teleconference. ” I think personal relationships matter and we’ll see how this turns out. But I will warn you I am cautiously optimistic about this.”
Xi’s personal involvement and deep understanding of the trade issues were also impressive.
“President Xi engaged in a level of detail — you could even say he was selling this, which was, in my opinion, quite unusual for the head of state,” Kudlow said. “Guys like me are supposed to know the details. He did. He made the pitch himself.”
The breadth and strength of China’s commitments during the summit were something not seen before from them.
“We have never had such broad-based, detailed — I’ll call them “commitments” at this point,” he told reporters. “It’s broader and more detailed than anything we’ve had.”
China also expressed a sense of urgency not heard before as Vice Premier Liu He told Kudlow that they would be removing tariffs and non-tariff barriers “immediately.”
“What do you mean, ‘immediately’?” Kudlow asked He. “And he said, ‘Immediately.’ I said, ‘Like Monday? Get going, Monday? That would be very persuasive.'”
Kudlow’s expectation is that any agreement would include the removal of auto tariffs, agriculture tariffs, and huge purchases of agriculture and energy. The two sides also discussed licensing or ownership rights to remedy some of the IP theft and forced technology transfers and the possible reconsideration of the Qualcomm-NXP merger.
“One last thing on the Qualcomm deal, which has not gone through: President Trump specifically asked President Xi if he would reconsider. And President Xi says if it were presented to him, he would reconsider signing off on that.”
Ambassador Robert Lighthizer will lead the next round of trade negotiations with China although the timing for those talks has not been specifically discussed other than Vice Premier He’s “immediately” commitment.