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Technology at center of US-China trade talks

a robot entertains visitors at the booth of a Chinese automaker during the China Auto 2018 show in Beijing, China.

Under President Xi Jinping, a program known as "Made in China 2025" aims to make China a tech superpower. | AP file photo

BEIJING — Chinese and U.S. officials met face-to-face Thursday in an attempt to resolve a dispute over technology that has taken the world’s two largest economies the closest they’ve ever come to a trade war.

A high-powered U.S. delegation arrived in Beijing for talks with Chinese officials aimed at defusing the tensions, though analysts say they appear unlikely to yield a breakthrough given the two sides’ intensifying rivalry in strategic technologies, where China lags behind the U.S.

Treasury Secretary Steven Mnuchin is leading the group, which includes Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer. Liu He, President Xi Jinping’s top economic adviser, headed the Chinese side in the talks, which are expected to end Friday.

The dispute has deepened as China has stepped up efforts to overtake western industry leaders in advanced technologies, especially for semiconductors, the silicon brains required to run smartphones, connected cars, cloud computing and artificial intelligence.

Under Xi, a program known as “Made in China 2025” aims to make China a tech superpower by advancing development of industries that in addition to semiconductors includes artificial intelligence, pharmaceuticals and electric vehicles. The plan mostly involves subsidizing Chinese firms. But it also requires foreign companies to provide key details about their technologies to Chinese partners.


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Trade talks continue Friday, with more meetings scheduled before the U.S. delegation departs Beijing on Friday evening.

Trump said on Twitter at the start of the talks that he expected relations to stay on an even keel.

“Our great financial team is in China trying to negotiate a level playing field on trade!” he tweeted. “I look forward to being with President Xi in the not too distant future. We will always have a good (great) relationship!”

On Thursday, the U.S. delegation had meetings with U.S. Ambassador Terry Branstad at the U.S. Embassy then went to a state guesthouse for meetings with the Chinese, followed by dinner. There were no public statements from either side afterward.
The consulting firm Eurasia Group said in a research note that rival views in Washington, reflected in the makeup of the U.S. team, could undermine the U.S. negotiating stance.

“The U.S. delegation headed to Beijing is too large and unwieldy to accomplish much; it is a reflection of inter-agency rivalry on the U.S. side and this will produce more posturing than actual negotiations with the Chinese,” the firm said.

“The trip will produce few results and increases the risk that tariffs are adopted in the near future,” it added.