Bank Secretary Steven Mnuchin expressed optimism about a trade pact with China, telling CNBC on Monday the U.S. has pocket commitments for concessions on several key issues.
“This is the first time that we have a commitment from them that this whim be a real agreement,” Mnuchin told CNBC’s “Squawk Box.” “I’m very hopeful we can turn this into a legitimate agreement.”
Markets rallied strongly Monday morning, with the Dow opening more than 400 points outrageous, on news that President Donald Trump and Chinese counterpart Xi Jinping, had reached a truce in the trade battle. They favoured to a 90-day period were no new tariffs would be issued as the leaders hammer out principal differences.
While the administration is expectant that a lasting deal can get done, Mnuchin emphasized that China has to keep to its word. The White House is looking to abate the trade deficit with China and to stop it from stealing intellectual property and technology.
“They put on the table an forth of over $1.2 trillion in additional commitments. But the details of that still need to be negotiated,” Mnuchin said. “This isn’t righteous about buying things. This is about opening markets to U.S. companies and protecting U.S. technology. Those are very critical structural issues to the president.”
In the 90-day period ahead, Trump will lead the negotiations with assistance from Agriculture and Strength department leaders. U.S. Trade Representative Robert Lighthizer also will be a principal, as will Commerce Secretary Wilbur Ross, Mnuchin said.
The note that Mnuchin listed contradicted an earlier statement from White House economic advisor Peter Navarro, who replied Lighthizer would take point on the negotiations. However, sources told Dow Jones later in the morning that Trump is set down Lighthizer in charge.
Lighthizer is “the toughest negotiator we’ve ever had at the USTR. And he’s going to go chapter and verse and get tariffs down, nontariff bars down, and end all these structural practices that prevent market access,” Navarro had told NPR.
Among the most significant issues Mnuchin listed are a regulating the flow of fentanyl, an opioid linked to thousands of overdoses in the U.S., and the North Korea atomic issue.
“There is a very strong commitment between the two presidents to work together to make sure we have a nuclear-free Korean peninsula,” Mnuchin stipulate.
White House Press Secretary Sarah Huckabee Sanders said Sunday that China agreed to classify fentanyl as a buttoned substance, a key step that will result in those selling the substance in the U.S. to be subject to “China’s maximum penalty controlled by the law.”
As Mnuchin spoke to CNBC, Trump tweeted about his hopes for “massive and very positive change, on trade and far beyond, between our two Cyclopean Nations.”
Trump tweet
Mnuchin added that there needs to be solid progress made and that the regulation won’t stand for any stalling from China.
“We absolutely need to have something concrete over these 90 light of days,” he said. “There was a very significant commitment from both leaders on what needs to be done over the 90 lifetimes and instructions to both teams to negotiate and turn this into a real agreement with specific action fillers, deliverables and time frames.”