In addition to the risks, the Trump team believes that China's trade position will be strong in 2020

WASHINGTON (Reuters) – Trade talks between China and the United States are resuming, advisers to President Donald Trump are confident in the fact that he can present his stance against Beijing as a force in the 2020 elections, despite concessions and the absence of any agreement in sight.

Trump and Chinese President Xi Jinping agreed in Japan last month of a new truce in the one-year trade war between the world's two largest economies, largely thanks to Trump's promise not to impose new tariffs on Chinese products and relax restrictions on the technology company Huawei Technologies Co Ltd.

The agreement in Osaka launched negotiations that had been stalled since May. Chinese and US negotiators spoke by phone on Tuesday and are discussing a face-to-face meeting in the future.

However, no deadline has been set for the end of the process, which leaves the possibility of a prolonged negotiation that will last until next year and the fight for the re-election of Trump.

"I think you are in 2020 before there is a resolution," said Steve Bannon, Trump's former chief strategist at the White House, who has pleaded for a tough position with regard to Beijing.

He applauded Trump's decision to remove the new tariffs and to be flexible about Huawei, as negotiations between the two countries resumed.

"I think it will help it politically because it's the reality of the world we live in," said Bannon.

The United States wants China to change what it sees as unfair trade practices, including the theft of intellectual property, the forced transfer of technology by US companies to their Chinese counterparts, the support to state-owned enterprises and the manipulation of currencies.

Trump has imposed 25% tariffs on $ 250 billion worth of Chinese goods and is committed to agreeing only to an agreement with Beijing providing for structural reforms of how China conducts its business.

Beijing's retaliatory tariffs last year on imports of US agricultural products hit US farmers hard, a riding that helped Trump win in 2016.

But the fact that Trump bowed to China as a presidential candidate in 2016 has delighted his crowds, and he is likely to highlight his pricing policy as a sign of tenacity in 2020.

Washington and Beijing were in the process of concluding an agreement in May when Chinese authorities hesitated over the need to change their laws to implement the reforms, US officials said. While other US leaders lobbied China to change its business practices, Trump's negotiating team may have brought Beijing closer to the deal that was found to change.

VULNERABILITY

Nevertheless, Democrats, many of whom are also in favor of a harsh Chinese approach, see Trump's move as a potential vulnerability.

The president insists that tariffs do not hurt US consumers and has offered tens of billions of dollars in badistance to affected farmers. In the absence of agreement by 2020 and tariffs still in effect, states with political failures such as Iowa and Pennsylvania, which supported Trump in 2016, could switch to the Democratic candidate next year.

"From Iowa farmers to a range of jobs in the Midwest in the manufacturing sector, successive states have supported it, starting from the promise that it would win the trade war with China and allow them to find jobs. Until now, he has done nothing, "said Scott Mulhauser, an expert in China and a former aide to Vice President Joe Biden, current leader of the Democratic presidential nomination of 2020.

This dynamic worries some members of Trump's circle.

Stephen Moore, the president's external economic adviser, said that a quick agreement would be helpful. The agreed de-escalation in Japan was positive, he said, but the truces do not last forever.

"Maybe that could help us through the elections," said Moore, who retired from the Federal Reserve bid earlier this year after criticizing her gender-biased comments on women and changing her policy. interest rate.

"My personal advice to Trump … when he asked me the question about him, is to conclude an agreement that you have concluded now and to choose a much harder line with China after your reelection," he said. declared.

Trump did not do all that he was committed to doing regarding China's bid in 2016. He did not declare the country as a currency handler and its pricing policy is counterbalanced by frequent and laudatory praise from Xi.

Famous for considering himself a qualified negotiator, Trump apparently did not push his Chinese counterpart to deliver on his promises to restore the promises Beijing had given up in May.

"The biggest success of the trade negotiations is to bring them back (China) to the table, but no date has been set and there is no public mention … of what they have taken over the "renegotiation" part, "said Michael Pillsbury, an outside commercial adviser to Trump, adding that the concessions were worth it to begin the talks.

"It's a bold decision, because if he did not do it, we might not have a discussion."

MOVING IN THE RIGHT DIRECTION?

Democrats have criticized Trump's tactics over China, while seeking to remain cautious. Tenacity against Beijing enjoys strong bipartisan support.

Biden had to go back and say that China was not a threat, but he criticized Trump's pricing tactics.

Sen. Bernie Sanders, who identifies as a democratic socialist and also occupies a prominent place in polls among overcrowded Democratic voters, sees China as a monetary manipulator. His campaign indicates that he agrees on the need for a firm stance on China, but not on the way Trump has conducted it.

But Trump's team views its balance sheet as a strength, believing that no trade deal is better than a bad deal and that progress is better than stalemate.

"President Trump is the first US President to stand up for China's bad trade agenda for decades, a position of strength that will resonate for voters worried about US jobs," the spokeswoman said. the Trump campaign, Erin Perrine.

US officials said China has agreed to increase purchases of US goods, but that these purchases, although announced by the president, have not always materialized. It could also have a political impact in 2020, if voters in agricultural and manufacturing states were convinced that his policies had not helped them.

"If people believe that things are going in the right direction and that there are still purchases of different agricultural products – soy and other products in these key states … then the president will be able to say just As things progress, "said Sean Spicer, former spokesman for Trump and himself a former chief of commerce.

"The question is simply whether it is going in the right direction."