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Trade war

US trade chief says China tariffs needed for future leverage

Lighthizer tells senators that talks are near end, deal or no deal

U.S. Trade Representative Robert Lighthizer, left, listens as Chinese Vice Premier Liu He talks during a photo opportunity at the Diaoyutai State Guesthouse in Beijing, China on Feb. 15.   © Reuters

NEW YORK -- Trade talks between the U.S. and China are in their final weeks with Washington refusing to give up its right to impose tariffs on Beijing should it violate any deal, the chief U.S. negotiator said Tuesday.

U.S. Trade Representative Robert Lighthizer spoke while testifying at a Senate finance committee hearing on the future of the World Trade Organization, where questions were largely focused on U.S.-China trade talks.

"We have to have real progress, and we have to maintain the right to be able to -- whatever happens to the current tariffs -- to raise tariffs in situations where there's violations of the agreement," he said. "And that's the core. If we don't do that, then none of it makes any difference."

Beijing has demanded the removal of existing punitive tariffs on $250 billion of Chinese goods, but such a "concession" is under debate, Lighthizer said.

If a deal to end the trade war between the world's two biggest economies is reached, it will be a thorough and detailed one, Lighthizer said.

"If we have an agreement, it will be 100 -- 110, 120 pages -- very very detailed, very specific."

Lighthizer said the two countries have come close to a consensus on ending China's currency manipulation, and that the agreement will be enforceable "as it stands right now."

"Our hope is we are in the final weeks of having an agreement," he said.

He told a Georgia senator that if a deal is reached with China, farmers in his state will be "very happy," hinting that a potential deal will benefit the American agricultural sector. That sector has been hit particularly hard in the trade war after Beijing imposed a 25% tariff on U.S. soybean imports in retaliation for tariffs on Chinese goods.

Lighthizer said ongoing negotiations are addressing structural issues, including technology transfer, intellectual property, and state subsidies, "with precision."

"That's not to say we've come to a conclusion because we haven't, but we're making headway."

Lighthizer told the senate committee that he was expected to speak to China's lead negotiator, Vice Premier Liu He, on Wednesday. Chinese media reported earlier that the two sides had talked on Tuesday.

"We are working more or less continuously," Lighthizer said.

Lighthizer also said at the hearing that it was unreasonable for countries such as China, India and South Korea to self-declare as developing nations.

Lighthizer said the U.S. has proposed a rule that will preclude countries considered "rich" by internationally recognized criteria to self-designate as developing countries, but said this will likely go nowhere as the WTO is a consensus organization, and the beneficiaries of preferential treatment will not cede to the U.S. proposal.

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