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Lighthizer: US wants 'measurable and enforceable' deal with China

The House Ways and Means committee is questioning United States Trade Representative Robert Lighthizer about trade talks with China.

In his opening statements, Chairman Richard Neal (D-MA) said a trade deal with China needs to secure changes – not just additional purchases of American goods.

“This administration has chosen to take the path of a high-risk confrontation with China. It must hold out for a good deal – a structural deal. The future of America’s economic prosperity is at stake,” Neal said.

Ranking member Rep. Kevin Brady (R-TX) said an agreement with China needs to be enforceable and measurable.

"While we want China to buy more U.S. goods that support farmers, manufacturers, and professionals here at home, it’s even more important for us to hold China accountable to meeting high international standards on intellectual property rights, subsidization, overcapacity, and the other structural ways in which China distorts the global economy,” Brady said in prepared remarks.

Lighthizer told lawmakers progress has been made with China but it’s still early to predict the outcome of negotiations.

“If we can complete this effort – and again I say “if” – and can reach a satisfactory solution to the all-important outstanding issue of enforceability as well as some other concerns, we might be able to have an agreement that helps us turn the corner in our economic relationship with China,” said Lighthizer.

On Sunday, President Trump announced he was delaying the Friday deadline when tariffs were set to increase from 10% to 25%.

Speaking to a group of governors earlier this week, Trump talked about the possibility of a “signing summit” after productive talks with China.

Enforcing a deal

While there has been some concern the administration would accept a deal that focuses on the trade imbalance, Lighthizer stressed that the administration wants a measurable and enforceable deal that addresses structural issues.

Lighthizer revealed some details about how enforcement would work, if a trade deal is made. Lighthizer said there will be monthly director-level meetings, quarterly vice ministerial level meetings and semi-annual meetings between him and China’s Vice Premier, Liu He, to discuss any issues.

“I should say, this is fairly unique idea -- right? This is not something that has a lot of precedent. But without that sort of thing, to me, we don’t have real commitments,” Lighthizer said.

He added that if a deal is made, individual companies will likely report individual complaints. He also expects systemic problems and patterns to arise.

“Hopefully, in most cases they’ll be resolved at the first or second level. If not, they’ll be resolved at my level,” he said. “If there’s disagreement at my level, the United States would expect to act proportionally but unilaterally to insist on enforcement.”

Lighthizer told lawmakers that negotiators were focused on intellectual property rights, forced technology transfer and other structural issues. Neal asked the trade rep if he envisions one negotiated package in the next few weeks that would solve all those issues.

"I'm not foolish enough to think that there’s going to be one negotiation that’s going to change all the practices of China or our relationship with them. I don't believe that,” replied Lighthizer.

Lighthizer repeatedly said if there is a deal, work will continue after the signing.

Jessica Smith is a reporter for Yahoo Finance based in Washington, D.C. Follow her on Twitter at @JessicaASmith8.

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