China mission: US Treasury Secretary Steven Mnuchin is considering a trip to China to discuss trade issues. Picture: REUTERS
China mission: US Treasury Secretary Steven Mnuchin is considering a trip to China to discuss trade issues. Picture: REUTERS

Washington — US Treasury Secretary Steven Mnuchin says he may travel to China, a move that could ease tension between the world’s two largest economies, as international policy makers acknowledged Beijing needs to change its trade practices.

The US has threatened to impose tariffs on up to $150bn of Chinese imports to try to force changes in Beijing’s industrial policies, which Washington says are aimed at acquiring American intellectual property.

Mnuchin told reporters he was continuing to have discussions with his Chinese counterparts to try resolve the differences over trade and said he might go to Beijing.

"A trip is under consideration," Mnuchin said at a news conference during the International Monetary Fund (IMF) and World Bank spring meetings in Washington. "I am not going to make any comment on timing, nor do I have anything confirmed," he said on Saturday.

Mnuchin also declined to say what he wanted from a trade deal with China

"If we have a deal, you’ll know what it looks like when we have it," he said.

China has threatened retaliation against US exports if Washington pushes ahead with the tariffs. The row, which comes as the world economy records its strongest growth in years, cast a pall over the gathering of the world’s finance officials.

Christine Lagarde, MD of the IMF, warned last week that a US-China trade war threatened to damage confidence, investment and growth. On Saturday, she told a media conference there would be no winners from such a conflict.

"It is important that as a global community we keep trade open, we ensure that we work within the multilateral system and that we have to make sure if there are disputes, these disputes are resolved," she said.

Mnuchin said he met China’s new central bank governor, Yi Gang, during the IMF and World Bank meetings and discussed the potential for China to open its markets to more foreign competition.

"I did meet with the Chinese here. The discussions were really more around the governor’s actions at the PBOC (People’s Bank of China) and certain actions they’ve announced in terms of opening some of their markets, which we very much encourage and appreciate."

In a statement on Saturday to the International Monetary and Financial Committee, Yi said China would "vigorously" push forward the reform and opening of its financial sector, significantly relax market access restrictions, create a more attractive investment environment, strengthen the protection of intellectual properties, and actively expand imports.

On Sunday, China’s commerce ministry said it would welcome US officials to discuss trade and economic issues.

"The Chinese side has received information that the US side hopes to come to Beijing to discuss economic and trade issues. China welcomes this," the ministry said.

Beijing announced last week that it would gradually eliminate ownership caps on foreign manufacturers of vehicles, aircraft and ships.

Regarding trade with Japan, Mnuchin said the US administration wanted a bilateral trade agreement.

Japan wants the US to rejoin the multilateral Trans-Pacific Partnership trade pact, as it fears opening talks for a bilateral free trade agreement could put it under pressure to open up politically sensitive markets like agriculture.