Trump says U.S.'s HK law doesn't help China trade talks

By Alexandra Alper and Se Young Lee

WASHINGTON/BEIJING (Reuters) - U.S. President Donald Trump said on Monday U.S. legislation backing protesters in Hong Kong did not make trade negotiations with China easier, but added he believes Beijing still wants a deal with the United States.

The law "doesn't make it better, but we'll see what happens," Trump said, talking to reporters. He gave no indication when the deal would be finalized, but two other U.S. officials said a deal could still happen this year depending on China's actions.

Washington and Beijing have yet to ink a so-called "phase one" trade agreement announced in October, which had raised hopes of a de-escalation in their prolonged trade war. The global economy has shuddered with each salvo of tariff hikes by the world's two largest economies.

"The Chinese are always negotiating. I'm very happy where we are," Trump said as he prepared to depart the White House for a NATO summit in London. "The Chinese want to make a deal. We'll see what happens."

Chinese President Xi Jinping said last month he wants to work out a trade deal with Washington, but broader bilateral tensions have flared amid U.S. legislative action supporting Hong Kong's protesters, and targeting camps for Uighur ethnic minorities in the western region of Xinjiang.

Trump last week signed a new law backing protesters in Hong Kong and threatened China with possible sanctions on human rights. Beijing in response barred U.S. military vessels and aircraft from visiting Hong Kong and sanctioned several U.S. non-government organizations. News site Axios also reported on Sunday the Hong Kong law stalled the trade deal.

Global Times, an influential tabloid published by the official People's Daily newspaper of China's ruling Communist Party, tweeted Tuesday that Beijing will soon release its so-called unreliable entities list imposing sanctions against those who harm China's interests.

The paper said China is expediting the process for the list because the U.S. House is expected to pass a bill on Xinjiang that will "harm Chinese firms' interests", and that "relevant" U.S. entities will be part of Beijing's list.

The U.S. Senate in September passed the Uyghur Human Rights Policy Act of 2019, a bill that calls on China to end what it calls "arbitrary detention, torture, and harassment" of Uighurs and other ethnic Muslim minorities. The bill is being considered by the U.S. House of Representatives.

Global Times editor-in-chief Hu Xijin also tweeted separately on Tuesday that China could ban all U.S. diplomatic passport holders from visiting Xinjiang and may also impose visa restrictions against U.S. lawmakers and officials with "odious performance" on Xinjiang. He did not say how he obtained this information.

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China's foreign ministry and the U.S. embassy in Beijing did not immediately respond to Reuters requests for comment on the reports of possible Chinese government action.

NEW TARIFFS LOOM

Experts and people close to the White House have said a China-U.S. trade agreement may not be signed until next year. But White House adviser Kellyanne Conway told reporters at the White House on Monday that the deal was still possible before the end of the year.

U.S. Commerce Secretary Wilbur Ross cited a further 15% U.S. tariff on about $156 billion worth of Chinese imports set to take effect Dec. 15 as a natural deadline, and said time was running out for China to avoid it.

"If nothing happens between now and then, the president has made quite clear he’ll put the tariffs in," Ross told Fox Business Network.

Asked if the Trump administration was willing to roll back current tariffs on China, Ross added: "It all depends on their behavior between now and then."