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  • Biden Seeks High Road as Impeachment Dominates Democratic Debate

  • Biden Seeks High Road as Impeachment Dominates Democratic Debate(Bloomberg) -- The impeachment drama engulfing Washington overshadowed the fifth Democratic presidential debate, serving to largely mute the policy differences between the 10 Democrats on stage as they joined in their repudiation of President Donald Trump.In that way, the night offered no decisive winner and little opportunity to shake up the race. Vice President Joe Biden turned in a crisp performance on his 77th birthday, particularly early on when addressing Trump?s alleged misdeeds.Democrats largely passed up the chance to turn their fire on Pete Buttigieg to blunt his momentum in Iowa, where he now leads in the polls, but continued their attacks on Elizabeth Warren for her plans for a wealth tax and Medicare for All.Second-tier candidates like Tulsi Gabbard and Tom Steyer garnered airtime disproportionate to their standing in the polls, while Amy Klobuchar scored with comments about how it?s tougher for women to compete in politics than men.?If you think a woman can?t beat Donald Trump, Nancy Pelosi does it every single day,? Klobuchar said to applause and cheers in the audience and trending mentions on social media.It would have been hard for anything that happened on the debate stage in Atlanta to compete with the daylong testimony that tied Trump directly to the quid pro quo related to Ukrainian foreign aid.But impeachment did have a benefit particularly for Biden, giving him the opportunity to remind Democrats that he has all the right enemies.The impeachment inquiry began, after all, after allegations that Trump threatened to withhold military aid to Ukraine until that country announced an investigation into Biden and his son, Hunter, who served on the board of a Ukrainian energy company.?I learned something about these impeachment trials. I learned, number one, that Donald Trump doesn?t want me to be the nominee. That?s pretty clear,? he said. ?And secondly I found out that Vladimir Putin doesn?t want me to be president.?Later, Biden took it as a badge of pride that North Korean dictator Kim Jong Un had called him a ?rabid dog? and quoted from Trump tweets insulting him.Biden also said he would not direct his Justice Department to prosecute Trump after he leaves office, but leave that decision to his attorney general, and deplored the ?lock him up? chants that have cropped up at sporting events and political rallies.Biden was less sure-footed later in the debate. He said he had won the endorsement of Carol Moseley Braun, who he said was the only black woman ever to serve in the U.S. Senate -- while Kamala Harris, a current black senator, stood just a few feet away.There were substantive issues raised by the MSNBC and Washington Post moderators, leading to exchanges on paid family leave, housing, immigration and decriminalizing marijuana. But with only disagreements around the edges on those issues, those questions, too, served to blur any substantive differences between the candidates.Warren once again found herself defending her Medicare for All proposal. She struggled to come up with a clear, concise answer of how she would implement and pay for it, even after releasing detailed spending plans and retreating on the timetable for implementing them.Early on, Warren and Cory Booker squared off over Warren?s wealth tax plan. Booker said Democrats needed to spend as much time figuring out how to help create wealth as taxing it.Sanders showed that he was still the same curmudgeonly socialist he?s been since 1980, despite a heart attack last month that sidelined him for nearly three weeks.He showed flashes of energy and humor, going back to his catchphrase the first time he was asked about Medicare for All. ?Thank you, I wrote the damn bill,? he said.Buttigieg, whose well-organized efforts in Iowa have propelled him to the top of polls in the first caucus state, sparred with Gabbard and took some not-subtle hits over his youth and lack of support among African-Americans. But his rivals didn?t treat him as roughly as they would a true front-runner.Trump was never far from the proceedings, and the debate?s focus on impeachment didn?t go unnoticed by the Trump campaign.?Tonight, 2020 Democrats were short on solutions and heavy on their unhealthy obsession with taking down President Trump via an illegitimate coup,? Trump campaign spokeswoman Kayleigh McEnany said. ?Their goal is singular and unified: defeat Trump at any cost.?Biden and his rivals were forced to discuss their views on the president repeatedly, with Biden calling for ?civility. We have to restore the soul of this country. And that?s not who we are, not who we?ve been, not who we should be. Follow the law,? he said.Biden?s high road stood in contrast to the partisan impeachment hearings that dominated the day?s news.But Sanders argued that a singular focus on impeachment was counterproductive.?We cannot simply be consumed by Donald Trump,? Sanders said. ?Because you know what? If we do, we will lose the election.?(Updates with Biden comment on black senators in 12th paragraph.)To contact the reporter on this story: Gregory Korte in Atlanta at gkorte@bloomberg.netTo contact the editors responsible for this story: Wendy Benjaminson at wbenjaminson@bloomberg.net, Craig GordonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • European Airlines Hone Plan to Tackle Public Backlash Over Emissions

  • European Airlines Hone Plan to Tackle Public Backlash Over Emissions(Bloomberg) -- Europe?s airlines are coalescing around a two-pronged response to a public backlash over carbon emissions.Carriers initially plan to extend the use of offsets like tree planting to compensate for greenhouse-gas output while also embracing sustainable biofuels, executives from companies including Deutsche Lufthansa AG, EasyJet Plc and IAG SA?s British Airways arm said at a conference in Berlin.A longer-term fix from the introduction of hybrid and fully-electric jetliners is unlikely to be available until the 2030s. Airlines are bracing for moves to slash emissions as new European Commission President Ursula von der Leyen prepares to unveil a package dubbed the ?Green New Deal.? So-called flight shaming is also taking root as campaigners including Greta Thunberg and groups such as Extinction Rebellion protest against air travel.?Aviation will have to substantially reduce its carbon emissions if it wants to grow,? Filip Cornelis, the European Commission?s director for aviation, said at the International Air Transport Association?s Wings of Change conference in the German capital Wednesday. ?That is the political reality in Europe today.?The consensus around mitigation efforts is emerging as a continuing surge in global travel more than outweighs gains from more-efficient aircraft. The United Nations says aviation is set to overtake power generation as the single biggest emitter of CO2 within three decades.EasyJet said Tuesday it will spend an estimated 25 million pounds ($32 million) on offset projects including afforestation with the objective of removing as much carbon dioxide from the atmosphere as its fleet emits.Lufthansa plans to introduce automatic offsetting for corporate clients and will introduce an optional surcharge for ?Sustainable Aviation Fuel? as it extends the use of kerosene alternatives produced from biomass and animal fats.?The solution just has to be the use of synthetic fuels,? Carsten Spohr, the carrier?s chief executive officer, said at the Berlin event. ?It?s the only vision I can see right now to really become CO2 neutral in the conceivable future.?To contact the reporter on this story: William Wilkes in Frankfurt at wwilkes1@bloomberg.netTo contact the editors responsible for this story: Reed Landberg at landberg@bloomberg.net, ;Anthony Palazzo at apalazzo@bloomberg.net, Christopher Jasper, Andrew NoëlFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Trump Expected to Sign Hong Kong Bill Despite China Threats

  • Trump Expected to Sign Hong Kong Bill Despite China Threats(Bloomberg) -- U.S. President Donald Trump is expected to sign legislation passed by Congress supporting Hong Kong protesters, setting up a confrontation with China that could imperil a long-awaited trade deal between the world?s two largest economies.The bill, approved unanimously by the Senate on Tuesday, passed the House 417-1 on Wednesday and could go to Trump as soon as Thursday. A person familiar with the matter said Trump planned to sign the bill.?The Congress is sending an unmistakable message to the world that the United States stands in solidarity with freedom-loving people of Hong Kong and that we fully support their fight for freedom,? Speaker Nancy Pelosi, a California Democrat, said on the House floor. ?This has been a very unifying issue for us.?The remarkable bipartisan support for a hard-line U.S. stance on China creates one of the toughest economic and foreign policy challenges of Trump?s presidency. He would like to sign what he calls ?phase one? of a China trade deal to ease economic uncertainly stemming from his trade war with Beijing as he ramps up his campaign for re-election.?After the Senate unanimously passed our Hong Kong Human Rights and Democracy Act, I applaud Speaker Pelosi for taking swift action to send this bill directly to President Trump?s desk for signature,? said Senator Marco Rubio, a Florida Republican and a sponsor of the Senate legislation. ?I urge the president to sign this critical bill into law as soon as possible.?QuickTake: Why Hong Kong?s ?Special Status? Is Touchy TerritoryThe bill, S. 1838, would require annual reviews of Hong Kong?s special trade status under U.S. law and sanction officials deemed responsible for human rights abuses and undermining the city?s autonomy. The House also passed another Senate bill, S. 2710, to ban the export of crowd-control items such as tear gas and rubber bullets to the Hong Kong police.?Ramifications? for CrackdownTrump has been largely silent on the Hong Kong protests as they escalated into violence in recent weeks, even as lawmakers of both parties demanded action. Chinese officials quickly responded to the bill?s Senate passage Tuesday, saying Beijing ?firmly? opposes the congressional action and calling it a grave violation of international law.The Hong Kong government said on Thursday that allowing the legislation to become law ?would send the wrong signal to violent protesters, which doesn?t help in cooling the situation.??We stand in solidarity with the people of Hong Kong,? said Republican Representative Chris Smith, who has been pushing the legislation since Hong Kong protests in 2014. ?There will be strong sanctions, other ramifications for this crackdown.?The Democratic-led House used an expedited process to quickly act on the Senate bill rather than trying to reconcile it with a slightly different version the House unanimously passed last month. That was the quickest way to approve the legislation before Congress recesses for the Thanksgiving holiday next week.China also came up in the Democratic presidential debate in Atlanta, with former Vice President Joe Biden promising to ?be vocally, vocally speaking out about the violation of the commitment they made to Hong Kong.? Asked specifically about how he would support the city?s demonstrators, Senator Cory Booker of New Jersey vowed to ?call China out for its human rights violations? while Andrew Yang said he would build an international coalition to pressure Beijing on such issues.Republican senators have been among the loudest voices calling for harsh consequences for China?s crackdown on protesters in Hong Kong. Senator Josh Hawley, a Republican from Missouri, wrote to United Nations Ambassador Kelly Craft asking for a resolution ?to condemn and hold accountable the People?s Republic of China? for human rights violations in Hong Kong.Craft said in an emailed statement that she is ?committed to supporting human dignity and advancing the cause of human rights at every available opportunity.?Trade Deal RisksSenate Majority Leader Mitch McConnell called on Trump to speak out, saying Monday that ?the world should hear from him directly that the United States stands with? the protesters.Vice President Mike Pence, however, said it would be difficult for the U.S. to sign a trade agreement with China if demonstrations in Hong Kong are met with violence.?The president?s made it clear it?ll be very hard for us to do a deal with China if there?s any violence or if that matter is not treated properly and humanely,? Pence said Tuesday in a radio interview.Trade negotiators are still making delicate progress on an accord, according to people close to the talks, who describe the negotiation as entering a make-or-break stage.Trump?s central argument to voters is the strength of the U.S. economy under his presidency and his ability to cut deals with other countries. Signing the Hong Kong bill could harden China?s negotiating position as the U.S. asks China to buy more agricultural products and Beijing insists that the U.S. reduce tariffs on Chinese goods.China ?condemns and firmly opposes? the legislation that Trump plans to sign, according to a statement from Foreign Ministry spokesman Geng Shuang after Tuesday?s Senate vote.?The U.S. should immediately stop interfering in Hong Kong affairs and China?s other internal affairs, or the negative consequences will boomerang on itself,? Geng said. ?China will have to take strong countermeasures to defend our national sovereignty, security and development interests if the U.S. insists on making the wrong decisions.?(Updates with Hong Kong government comment in eighth paragraph)\--With assistance from Jordan Fabian, Shawn Donnan, Jenny Leonard, Steven Yang and Natalie Lung.To contact the reporters on this story: Daniel Flatley in Washington at dflatley1@bloomberg.net;Justin Sink in Washington at jsink1@bloomberg.netTo contact the editors responsible for this story: Joe Sobczyk at jsobczyk@bloomberg.net, Alex WayneFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • President Andrew Yang's first words to Russia's Vladimir Putin: 'I'm sorry I beat your guy'

  • President Andrew Yang's first words to Russia's Vladimir Putin: 'I'm sorry I beat your guy'Andrew Yang didn't get much speaking time at Wednesday night's Democratic presidential debate in Atlanta, but he made memorable use of the time he got. Near the end of the debate, Yang was asked what he would say, if elected, in his first call with Russian President Vladimir Putin. "Well, first I'd say I'm sorry I beat your guy," he said. "Or not sorry," he added, after a pause for applause. "And second, I'd say the days of meddling in American elections are over, and we will take any undermining of our democratic processes as an act of hostility and aggression."Yang continued with a substantive answer, though he got a little in the weeds of mixed metaphors with his proposal for a "new World Data Organization, like a WTO for data, because right now, unfortunately, we're living in a world where data is the new oil and we don't have our arms around it."More stories from theweek.com Ken Starr on the Sondland testimony: 'It's over' Biden scoffs at idea that Medicare-for-all bill could pass the House or Senate India is entering a new dark age

  • Esper doesn?t regret delaying drills, despite N. Korea snub

  • Esper doesn?t regret delaying drills, despite N. Korea snubU.S. Defense Secretary Mark Esper says he does not regret postponing a U.S.-South Korean military air exercise, even though the gesture was rejected by North Korea as not enough to restart nuclear diplomacy. Esper spoke to reporters Thursday morning shortly before boarding his plane in Hanoi, Vietnam, for a flight to Washington.

  • China Committed to Peace Despite Challenges, Vice President Says

  • China Committed to Peace Despite Challenges, Vice President Says(Bloomberg) -- A top deputy to Chinese President Xi Jinping reaffirmed China?s commitment to market-based economic reforms, while warning that the international order ?was under attack.?Vice President Wang Qishan, who?s one of China?s best known economic reformers, told Bloomberg?s New Economy Forum on Thursday that the country would follow through on policy changes despite facing serious challenges at home and aboard. He said the country would continue to let the market play a ?decisive role? in the allocation for resources and stick to the path of peaceful development.?Between war and peace, the Chinese people firmly choose peace. Humanity cherishes peace,? Wang said in his keynote address in Beijing. ?We should abandon the zero-sum thinking and cold war mentality.?The New Economy Forum is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News. Other guests include Microsoft Corp. founder Bill Gates, former U.S. Treasury Secretary Hank Paulson and former U.S. Secretary of State Henry Kissinger.Wang?s speech comes as the U.S. and China work to assemble a partial trade agreement, even as broader tensions mount in the U.S.-China relationship from human rights concerns over Hong Kong and the western region of Xinjiang to strategic competition in the South China Sea. The sides are making progress in key areas, according to people close to the talks, even as concerns grow that efforts to nail down the first phase of a broader deal are stalling.U.S. President Donald Trump is expected to sign legislation passed by Congress supporting the Hong Kong protesters, a person familiar said, after the bill was approved unanimously by the Senate on Tuesday and passed the House 417-1 on Wednesday.Trump -- facing an impeachment inquiry at home -- may seek a political win by reaching a trade deal with China. Policy makers in Beijing face their own troubles with a slowing economy at home, as well as factory-price deflation, a fragile financial system and spiraling food costs in the wake of a catastrophic disease epidemic among the nation?s pig herd.?Development must be balanced and inclusive,? Wang said Thursday. ?We need to work together to make economic globalization work for all people across the world.?Wang struck a less confrontational tone than when he addressed the same forum last year in Singapore as trade tensions were at a crescendo. In his remarks last year, he both reaffirmed China?s desire to move forward with trade talks and warned that his country wouldn?t again be ?bullied and oppressed? by foreign powers.\--With assistance from Dandan Li and Tian Ying.To contact Bloomberg News staff for this story: Peter Martin in Beijing at pmartin138@bloomberg.net;Miao Han in Beijing at mhan22@bloomberg.netTo contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Sharon ChenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • China Risks Hurting Itself by Hitting U.S. Over Hong Kong Bill

  • China Risks Hurting Itself by Hitting U.S. Over Hong Kong Bill(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. China had a swift and forceful response after the U.S. Senate passed legislation supporting Hong Kong?s pro-democracy protesters, with multiple government agencies threatening some sort of unspecified retaliation.?Don?t say I didn?t warn you,? said a statement issued on Wednesday by the foreign ministry?s office in Hong Kong, using a Chinese phrase that prior to this year was used only in rare cases like before a 1962 war with India.But President Xi Jinping?s government has a problem: Any strong measures against the U.S. also risk backfiring on China. That?s particularly dangerous as he struggles to contain escalating violence in Hong Kong and negotiates a trade pact with the U.S. all while the economy grows at its slowest pace in decades.China?s retaliation since President Donald Trump kicked off a trade war last year has mostly been tit-for-tat tariffs, and always with the caveat that it was left with no other choice. In other areas where it?s been hit by the U.S. -- Taiwan arms sales, sanctions over human-rights abuses in the far west region of Xinjiang, putting Huawei Technologies Co. on a blacklist -- China has held fire despite threats to hit back.?It?s worth noting that the U.S. can do more damage to China than China can do to the U.S.,? said Shi Yinhong, an adviser to China?s cabinet who is a professor of international relations at Renmin University in Beijing.The Hong Kong Human Rights and Democracy Act would require the State Department to determine each year whether the city remains sufficiently autonomous from Beijing to justify special trade privileges. It also outlines potential sanctions on mainland officials who suppress human rights.The biggest concern among those in the markets is whether the bill will derail talks on a phase one trade deal that are entering their final stages. Hong Kong stocks slumped on Thursday, while the yuan weakened to a three-week low amid signs of a widening rift between the U.S. and China.?The imminent retaliation from China would be on the on-going trade talks,? said Huiyao Wang, another adviser to China?s cabinet and founder of the Center for China and Globalization in Beijing. ?The Hong Kong bill will do tremendous damage to the prospect of a trade deal and stall the negotiation process as China?s side won?t engage positively with U.S. counterparts.?Trump DilemmaFor Trump, that presents a dilemma. A major reason he wants a deal now is so China can buy large amounts of agricultural products from swing states he needs to win re-election next year. If that doesn?t happen, his own political future is in doubt.His position is even trickier because Congress would easily be able to override any veto. A person familiar with the matter told Bloomberg that Trump plans to sign the bill, a move that could set back trade talks. Still, refusing to sign it would give his political opponents a chance to attack him for being weak on China.As a one-party state, China doesn?t have to worry about that type of electoral pressure. But it also wants to stop the bleeding and avoid more tariff increases, including one still due to take place in December. And Xi may be under pressure within the Communist Party: A rare leak to the New York Times this week of internal documents showing human-rights abuses in Xinjiang signaled some dissent in China?s opaque political system.Beyond delaying trade talks, China has a number of options. It could hit out at U.S. companies, halt cooperation on enforcing sanctions related to North Korea and Iran, recall the Chinese ambassador to the U.S. or downgrade diplomatic relations.China?s Trump Retaliation Options Range From Soybeans to BoeingIn May, after the U.S. blacklisted Huawei, China signaled it would curb exports to the U.S. of rare earths that are critical to everything from smartphones to electronic vehicles to wind turbines. The government also said it will establish a list of so-called ?unreliable? entities it says damage the interests of domestic companies, a sweeping order that could potentially affect thousands of foreign firms.Around that time, the flagship People?s Daily even used the same phrase ?don?t say I didn?t warn you? that at one time carried enormous weight. Yet China still hasn?t implemented those measures, preferring instead to head back to the negotiating table.?Cry Foul?When it comes to Hong Kong, Trump already has enormous leverage. Under the Hong Kong Policy Act of 1992, the U.S. president can issue an order removing the special trading status that underpins its economy, potentially with devastating consequences.Beijing realizes the U.S. is unlikely to do that, so is likely to limit itself to ?very high-sounding, rhetorical responses? rather than concrete actions hitting American economic interests, according to Willy Lam, an adjunct professor at the Chinese University of Hong Kong?s Centre for China Studies, who has authored numerous books on Chinese politics.?The Chinese will, of course, cry foul, but the real reaction may not be that severe,? Lam said. ?They will watch the situation and make a judgment later.?(Updates with stocks, report on Trump planning to sign bill)To contact Bloomberg News staff for this story: Iain Marlow in Hong Kong at imarlow1@bloomberg.net;Dandan Li in Beijing at dli395@bloomberg.netTo contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Daniel Ten Kate, Karen LeighFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • U.S.-China Trade Deal Inches Ahead, Shadowed by Failure Risk

  • U.S.-China Trade Deal Inches Ahead, Shadowed by Failure Risk(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. After almost two years of negotiations and escalations -- and plenty of false dawns -- trade negotiators from the U.S. and China are making progress in key areas even as concerns grow that efforts to nail down the first phase of a broader deal are stalling.Some people close to the talks describe them as being in a sensitive, make-or-break stage and caution that what President Donald Trump proclaimed as a done deal a month ago, sending U.S. stocks soaring to records, could still easily fall apart.Hanging over the discussion is the deteriorating situation in Hong Kong -- and a push by the U.S. Congress to send a bill to Trump for his signature that would require annual reviews of the territory?s special status and sanction officials deemed responsible for undermining the city?s autonomy. The House approved the measure Wednesday and Trump said he would sign it, though China has threatened to retaliate.That means less than a year from the 2020 presidential elections, Trump?s push to rewire the world?s most important economic relationship is simultaneously close to yielding its first narrow victory and teetering on the edge of a collapse.The latter outcome would trigger another round of tit-for-tat tariffs, the potential consequences of which were on display Wednesday when the president visited an Apple Inc. factory in Texas.Apple has said producing its high-end Mac Pro laptop at the plant was only possible because of the exemption of key components from existing tariffs and Trump during his visit raised the possibility of further exemptions.But if efforts to reach a ?phase one? deal fail before Dec. 15, Trump has threatened to impose 15% tariffs on some $160 billion in imports from China including smartphones and laptop computers -- two key Apple products. Stocks gyrated Wednesday on conflicting reports about the timing of any pact.People close to the discussions insist negotiators so far have been able to avoid having growing areas of friction, like Hong Kong, infect the talks. The looming December tariffs, meanwhile, have replaced a canceled Nov. 16-17 summit in Chile at which Trump and China?s Xi Jinping were expected to sign a deal as a hard deadline.During a video conference late last week between Robert Lighthizer, Trump?s trade representative, Treasury Secretary Steven Mnuchin and China?s lead negotiator, Vice Premier Liu He, the two sides agreed to accelerate efforts to reach a deal to avoid the new tariffs taking effect, according to people briefed on the discussions.During that call and others in recent days, officials from the two sides have made some progress on issues ranging from the parameters of a Chinese crackdown on intellectual-property theft to how a deal might be enforced, according to officials and other people briefed on the discussions.They have struggled, however, to find agreement over the details of other commitments that Trump wants to be part of an initial agreement including the schedule of agricultural purchases he is demanding and exactly which tariffs to remove, those people say.Trump has sought to maintain pressure on China in public. ?China would much rather make a trade deal than I would,? he told reporters on Wednesday. ?I don?t think they?re stepping up to the level that I want.?The Asian country?s media, meanwhile, has continued to take a tough line. ?Few Chinese believe that China and the U.S. can reach a deal soon,? Hu Xijin, editor of the state-run Global Times, tweeted on Wednesday. ?China wants a deal but is prepared for the worst-case scenario, a prolonged trade war.?One thing that has become increasingly less likely is a face-to-face meeting between Trump and Xi before the year?s end.The Chinese Communist Party?s flagship newspaper, the People?s Daily, earlier this week described Xi?s recently concluded visit to Brazil as his ?final foreign trip this year,? indicating there are no plans now to venture overseas for a signing ceremony in the closing weeks of 2019.In response, officials on both sides have begun to discuss the possibility that ministers sign a deal instead of opting for a more logistically complicated ceremony involving the two leaders.People close to the talks in China say Liu could be given the title ?special envoy? to sign the deal, pointing to 2016 and the fact that then-Vice Premier Zhang Gaoli acted as Xi?s special envoy to sign the Paris Agreement on climate change on behalf of China.But the priority before those details are worked out remains overcoming the final sticking points.Farm PurchasesChina?s reluctance to agree to the detailed commitments on agricultural purchases that Trump has said he wants to see double from pre-trade war levels to as much as $50 billion annually within a couple of years is based in part on the difficulty of reaching those heights. Chinese officials continue to insist any purchases would have be market-based and comply with World Trade Organization rules.Officials in Beijing are continuing to push for all additional tariffs to be rolled back, and both sides indicated they would accept an enforcement mechanism that could see duties reimposed if differences can?t be resolved through negotiation, according to people briefed on the talks.China is insisting that tariff moves have to be ?reciprocal,? borrowing a key word from Trump?s trade lexicon.How the deal would be enforced was one of the main sticking points when talks fell apart in May, and Beijing faulted the Trump administration for violating its sovereignty by forcing the country to change its laws and sign up to a one-way enforcement regime.The negotiating teams are using their failed May proposal as a benchmark for how much a phase-one deal covers of the once-near agreement and how much tariffs will be removed as part of the initial deal.Observers SkepticalThose difficult issues are just one of the reasons some close observers of the talks remain skeptical that even the once-promising initial deal will surface.Scott Kennedy, an expert on U.S.-China economic relations at the Center for Strategic and International Studies in Washington, said Trump?s escalation over the summer had been ill-conceived and signs of progress seemed more targeted at calming markets than resolving significant structural problems like China?s vast web of industrial subsidies.?We?re far beyond, ?The boy who cried wolf,?? Kennedy said. ?Someone now could write a new story, ?The leader who called ?deal.??(Updates with President Trump comments in 12th paragraph)\--With assistance from Miao Han, Dandan Li, Zoe Schneeweiss and Jordan Fabian.To contact the reporters on this story: Shawn Donnan in Beijing at sdonnan@bloomberg.net;Jenny Leonard in Washington at jleonard67@bloomberg.net;Steven Yang in Beijing at kyang74@bloomberg.netTo contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, ;Margaret Collins at mcollins45@bloomberg.net, Ana MonteiroFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.



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