US says ‘substantial progress’ after trade talks with China

Good morning and welcome again to FirstFT Asia. In at the moment’s e-newsletter:

• US expresses optimism over China commerce talks

• Fragile India-Pakistan ceasefire holds

• Scotch makers toast UK-India commerce deal

Treasury secretary Scott Bessent yesterday mentioned the US and China had made “substantial progress” over two days of trade talks in Geneva. The optimistic feedback have been the primary signal that Washington and Beijing might begin to ratchet down financial tensions.

What US and Chinese language officers mentioned: “We will probably be giving particulars tomorrow, however I can let you know that the talks have been productive,” Bessent advised reporters after he and US commerce consultant Jamieson Greer completed their conferences with Chinese language vice-premier He Lifeng. Greer mentioned it was “vital to know how rapidly we have been in a position to come to settlement, which displays that maybe the variations weren’t so giant as possibly thought” and added that there had been a “lot of groundwork”. 

The Chinese language vice-premier mentioned the 2 sides had held candid and constructive talks and had agreed to create a consultative mechanism to proceed commerce and financial negotiations, in keeping with Reuters.

What’s at stake: The US has positioned a 145 per cent tariff on items from China whereas Beijing has retaliated with its personal 125 per cent levy — measures which have roiled monetary markets and triggered issues about international provide chains. Bessent mentioned China confronted financial challenges and had extra incentive to return to the desk. However the Trump administration turned extra involved following warnings from Wall Road and after retail giants Walmart and Goal advised the president that retailer cabinets would develop into empty. Read the full story.

Right here’s what else we’re protecting tabs on at the moment:

• Financial knowledge: India publishes April CPI inflation figures.

• Chinese language diplomacy: Brazilian President Luiz Inácio Lula da Silva is in Beijing for a state go to. In the meantime Chinese language vice-premier He Lifeng visits France, the place he’s scheduled to chair the China-France Excessive Stage Financial and Monetary Dialogue.

• Philippines: Relations with China loom over at the moment’s nationwide and native midterm elections. (Reuters)

5 extra high tales

1. A ceasefire settlement between India and Pakistan seemed to be holding yesterday, although every had earlier accused the opposite of violations and differed on what had been agreed. US President Donald Trump, who had claimed credit score for the ceasefire, pledged to “enhance commerce, considerably, with each of those nice Nations” and “work with you each” to discover a resolution to the Kashmir dispute. Read the full story.

2. Ukrainian President Volodymyr Zelenskyy has mentioned that he’s prepared to begin peace talks with Vladimir Putin in Istanbul on Thursday, after Trump advised him to satisfy the Russian president there “instantly”. Zelenskyy’s offer came after a back-and-forth by which Ukraine referred to as for Moscow to conform to a 30-day unconditional ceasefire beginning Monday, to which Putin mentioned the 2 sides ought to as an alternative maintain talks this week in Turkey.

3. OpenAI and Microsoft are rewriting the phrases of their multibillion-dollar partnership in a negotiation designed to permit the ChatGPT maker to launch a future preliminary public providing, whereas defending the software program large’s entry to cutting-edge synthetic intelligence fashions. Read more about the high-stakes talks.

4. Hamas mentioned yesterday it will launch an Israeli-American hostage held in Gaza as a goodwill gesture to Trump. The Palestinian militant group’s transfer to launch Edan Alexander comes because the US president prepares to visit the Middle East this week.

5. Colombia faces doable US commerce retaliation after its leftwing President Gustavo Petro mentioned he deliberate to enroll to Beijing’s Belt and Highway infrastructure initiative throughout a go to to China for a regional assembly subsequent week. Colombia has lengthy been certainly one of Washington’s most vital South American allies, so a transfer by Bogotá to hitch BRI would be a significant win for Beijing.

Information in-depth

India and Pakistan’s skirmish final week, their most severe in many years, was additionally a testing ground for equipment crucial to a different rivalry: that between China and the US-led western alliance. About 81 per cent of Pakistan’s army tools comes from China, whereas India has emerged because the world’s largest weapons importer. Analysts mentioned mounting proof {that a} Pakistani pilot in a Chinese language-made fighter jet shot down India’s French-made plane “got here as a nice shock for China”.

We’re additionally studying . . . 

Chart of the day

The UK-India commerce deal agreed final week will halve tariffs on Scotch whisky into the world’s greatest export market by quantity for the spirit. With the loosening of commerce obstacles, analysts mentioned exporters to India have been now more likely to push pricier bottled Scotch “which may ship long-term upsides”.

Take a break from the information

Go contained in the management room that monitors every subway train in New York. Underneath stress from the Trump administration, which has threatened to withhold federal funding for the transportation system, a devoted band pulls the levers and pushes the buttons that maintain town shifting.