US, China downplay major tech issues in temporary trade deal at G-20

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Whether the truce holds or not will come down to not only the substance of the negotiations, but also the degree to which Trump is willing to accept Chinese commitments, Hirson explained.

Domestic political reaction in the U.S. over the coming weeks could also influence Trump’s stance — pressure from his own party and political base, as well as from the Democrats, could push Trump to draw a harder line on technology transfer and intellectual property issues, Hirson added.

In a Saturday note, Eurasia Group also pointed out that technology and industrial policy, areas where the U.S. wants concessions, are central to Xi’s core agenda of making China an innovation superpower — which further adds to the difficulties of reaching a mutually agreeable position.

“The key question (is): What needs to happen in these 90 days in a concrete way to keep the negotiations going on beyond it,” said Okun from McLarty Associates.

Realistically, he said, both countries will not be able to address all the points of the dispute in such a short period of time, which includes the Trump administration wanting to see a drastic change in China’s trade architecture.

He added that stopping intellectual property violations and forced technology transfers going forward may be achieved during the negotiating period, but “how do you remedy the past violations? That can’t be done in 90 days.”

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