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World

U.S. Continues Trade Talks With China Despite Trump's Tariff Threat

AILSA CHANG, HOST:

The U.S. and China's months-long effort to reach a trade deal could be falling apart - maybe. The Trump administration says that China has reneged on previous commitments and that the U.S. will increase tariffs on $200 billion worth of Chinese goods on Friday. Stocks fell sharply today as fears of a trade war mounted. But negotiators from both countries are still going forward with a trade meeting in Washington this week to try to strike a last-minute deal. Here to explain is NPR's Shanghai correspondent Rob Schmitz. Hey, Rob.

ROB SCHMITZ, BYLINE: Hi.

CHANG: So how is Beijing handling these threats of more tariffs from the Trump administration right now?

SCHMITZ: Well, Ailsa, they are taking it in stride. China today confirmed that Vice Premier Liu He, the lead negotiator for China, is going to go ahead with his scheduled trip to Washington later this week. So that's a sign that China's putting aside these threats from President Trump and any accusations of reneging on a deal so that it can try to come to a trade agreement with Washington once and for all.

CHANG: Do we have any sense of what these previous commitments were that China allegedly has been reneging on?

SCHMITZ: Well, we don't know for sure, but we have an inkling of what they are. One of them is this enforcement mechanism that the U.S. wants to impose on China to make sure that China lives up to its promises. And of course, for China, that might infringe on its sovereignty, so that's a big sticking point. Another one is that the U.S. has been demanding that China make structural changes to its economy. And of course, that would weaken the power of China's Communist Party, which, of course, is the government of China. So that is a no-go, as well.

CHANG: So as we're heading into this homestretch, or what is reportedly the homestretch of these trade talks, what are the politics for President Xi Jinping back home?

SCHMITZ: Well, he's got two possibilities here. These tariffs go up on Friday. Both the U.S. and the Chinese economy would feel the pain. Markets would respond. And here in China, the timing is not great. China's growth is slowing. The government has stepped in with stimulus to try and cushion the blow. And higher tariffs would put more pressure on China's financial system. That said, the notion of Xi Jinping standing up to an American president plays into this carefully crafted aura of him inside of China as this strongman leader who's willing to fight back against China's biggest global rival. So it could play in his favor.

CHANG: Now, one thing that has not been on the table during these trade talks is China's interment of millions of Chinese Muslims - Uighurs - something that has concerned human rights groups here in the U.S. Do you think that there's any chance that this human rights concern will be addressed during these trade talks?

SCHMITZ: Well, it certainly doesn't seem like it. The State Department has ratcheted up its criticism of China on this issue, but the Commerce Department and the U.S. trade representative who are handling the trade negotiations don't seem receptive to having this issue be a part of the talks. Secretary of State Mike Pompeo did seem to separate the two issues in an interview on "Face The Nation" on Sunday, saying the administration has to do more than one thing at a time.

CHANG: And you were just in Xinjiang last week, right? Tell us what you saw there.

SCHMITZ: Well, I was on a government-sponsored trip. And everything was pretty choreographed, but it didn't take long to see beyond that. And what I saw is that China's government is locking up its Muslim population inside these re-education camps for what it calls extremist thoughts. And when I pressed a Chinese government official about it, he told me that China's government believes it should detain Muslims based not on actual crimes they commit, but on crimes they may someday commit. In other words, if Xinjiang authorities believe its Muslim residents are showing signs of committing crimes, they'll detain them to try and prevent crime in the first place. And among all the interviews we had in Xinjiang, it was this one with a government official that left many of the Western journalists like me on this trip feeling pretty uneasy about that.

CHANG: I can imagine. Thank you so much. That was NPR's Rob Schmitz in Shanghai.

SCHMITZ: Thanks, Ailsa. Transcript provided by NPR, Copyright NPR.