US trade negotiators may ‘smell blood in the water’ if China makes concessions in EU talks

US trade negotiators may ‘smell blood in the water’ if China makes concessions in EU talks

  • As EU-China investment treaty talks reach a crucial point, analysts say Trump White House will be watching for any concessions made
  • United States and European Union share same objectives on China, experts say, but doubtful whether coordinated approach is imminent

This is the fourth in a series of five articles analysing the potential for an EU-China investment treaty, looking at negotiating positions, sticking points and geopolitical tensions. You can read part one in the series here, part two here and part three here.When top European Union (EU) officials face off with their Chinese counterparts next week to try and hammer out an investment treaty, figures in Washington, where US trade officials spent two presidential terms trying to do the same, will be watching closely.No one in the United States will feel the pressure more than President Donald Trump, who has staked much of his reputation on creating a more balanced trade and investment relationship with China. Any concessions the EU might extract from Beijing would likely intensify the US leader’s hard-driving approach to a bilateral trade war with China that has dragged on for two years, analysts said.

“If the US sees China making serious reform concessions to the EU, it might smell blood in the water and push even harder on reaching an agreement with Beijing,” said Eurasia Group’s China analyst Kelsey Broderick. “It would likely incentivise US actors to push China hard on phase two [trade deal] commitments.”