Kudlow Blames China for Not Engaging Ahead of Trump-Xi Meeting

(Bloomberg) -- U.S. President Donald Trump’s top economic adviser accused China of refusing to engage on trade issues in a Financial Times interview, while a separate report said Trump believes it will take more time for tariffs to bite.

"We gave them a detailed list of asks, regarding technology for example, [which] basically hasn’t changed for five or six months. The problem with the story is that they don’t respond. Nothing. Nada," National Economic Council Director Larry Kudlow told the Financial Times in an interview published Sunday in Washington. "It’s really the president and the Chinese Communist party, they have to make a decision, and so far they have not, or they have made a decision not to do anything, nothing. I’ve never seen anything like it."

Separately, Axios reported Sunday that Trump believes it will take more time for tariffs recently imposed by the U.S. on Chinese imports to have an impact on China’s economy, and he believes he will gain more leverage in trade negotiations the longer they remain in place.

Trump and Chinese President Xi Jinping are expected to meet at the G20 summit of global leaders in Argentina next month. Trade talks have been on ice since late September, when the two countries implemented another round of tariffs on each other’s imports.

Kudlow’s comments and the Axios report follow a three-day stretch in which top Chinese officials including Xi sought to bolster investor confidence via statements as well as comments reported by state-run media outlets.

The benchmark Shanghai Stock Exchange Composite Index fell last week to its lowest level in four years as trade tensions and concerns about an economic slowdown weighed on sentiment. Growth decelerated to 6.5 percent in the third quarter, according to data published Oct. 19 by the National Bureau of Statistics.

In May, U.S. and Chinese negotiators issued long lists of demands during talks in Beijing. Among U.S. demands were a reduction in the country’s trade deficit with China and abandonment of subsidies and government support to industries included in its Made in China 2025 industrial policy program.

China’s demands included the U.S. ceasing a ban on exports to China of integrated circuits, opening government procurement to Chinese technology products and services, and giving Chinese companies equal treatment in national security reviews.

Gao Feng, a spokesman for China’s Ministry of Commerce, told reporters during a weekly press briefing on October 18 that the U.S. needs to show sincerity if it wishes to resume talks. His boss, Commerce Minister Zhong Shan, told Bloomberg that China would not back down in the face of higher U.S. tariffs on Chinese products, adding that "China doesn’t want a trade war, but would rise up to it should it break out."

To contact Bloomberg News staff for this story: Matthew Boesler in Beijing at mboesler1@bloomberg.net

To contact the editors responsible for this story: Malcolm Scott at mscott23@bloomberg.net, Karl Lester M. Yap

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With assistance from Editorial Board