China just extended an olive branch to the US as trade talks restart
China will broaden the ability of some foreign firms to invest in the country a year earlier than expected, a move that comes as trade talks with the U.S. begin again in earnest.
“We will move up the lifting of foreign capital limits in securities, futures and life insurance, from 2021 to 2020,” Premier Li Keqiang, China’s second-ranking official, said on Tuesday at a meeting of the World Economic Forum, according to the New York Times. “This shows China’s commitment to opening up.”
While it's a small gesture towards improving the relationship with the Trump administration after trade talks fell apart in May, the move won’t satisfy the White House’s more sweeping demands that China amend its laws to protect U.S. business interests in the country.
Currently, foreign firms are only allowed to hold partial stakes in Chinese businesses. The pending switch in 2020 will allow securities firms and others to control those operations.
At the recent G20 summit in Japan, Trump and Chinese President Xi Jinping agreed to relaunch trade talks and withhold the imposition of any new tariffs. Negotiations between the two nations broke down when China backtracked on previously agreed upon terms, according to top administration officials.
In March, China made changes to its existing law governing foreign investment in an effort to address complaints that the government doesn’t adequately ensure the safety of American intellectual property, but critics said the overly broad measure did not go far enough in addressing those concerns.
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Alongside the decision on financial investment, Li also made a tenuous commitment to not devalue its currency, according to the New York Times, a pledge that could help stabilize the trading relationship with the U.S.
As the value of the renminbi, the Chinese currency, declines relative to the U.S. dollar, it makes exports from the Asian nation cheaper in comparison.