China may back out of trade talks scheduled for this week with U.S. officials after President Donald Trump threatened Beijing with increased tariffs.
Trump said in a Sunday afternoon Twitter post that the current 10% tariffs on $200 billion worth of Chinese goods will rise to 25% on Friday. He also threatened to impose 25% levies on an additional $325 billion of Chinese goods “shortly.”
Chinese Vice Premier Liu He had planned to bring a large delegation to Washington on Wednesday to hash out a trade deal — and there’d been talk in recent days that something resembling a deal could result. Instead, two sources briefed on the talks said the Chinese side may back out of this week’s negotiations.
That was pegged to Trump’s new threats, they said, which abandon a six-month truce after Beijing waffled on some previously discussed commitments.
One source said the Chinese vice premier will likely cancel the trip he’d planned for himself and a 100-person delegation for the final round of talks that U.S. officials had previously said could yield a deal by Friday. Chinese officials canceled a trip in late September 2018 in similar circumstances.
A second source said Trump’s decision to more than double the tariff rate on $200 billion of goods was meant to send a message to Liu to not come to the U.S. with more “empty offers.”
The White House, the Treasury and the U.S. Trade Representative’s office did not immediately respond to CNBC’s requests for comment.