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- China pours cold water on bilateral meeting with US defense minister – FT
China pours cold water on bilateral meeting with US defense minister – FT
Financial Times (FT) came out with news suggesting a standoff between the US and China while turning down the hopes of a meeting among the military officials of the world’s top two economies.
“China has told the US there is little chance of a meeting between the countries’ defense ministers at a security forum in Singapore due to a dispute over sanctions, the latest obstacle to top-level dialogue between the two powers,” said FT.
The news cites difficulties in arranging a meeting of US Defense Secretary Lloyd Austin and China’s new Defense Minister Li Shangfu at the Shangri-La Dialogue security forum in Singapore in June. The reason could be linked to China’s Li being sanctioned by the US in 2018 in relation to Chinese imports of Russian arms when he was serving as a general.
Additional quotes from FT
The US has told China that the sanctions do not prevent Austin from meeting Li in a third country. But several people said it would be almost impossible for China to agree to a meeting while they remain in place. Li became Defense Minister in March.
There was no prospect of the Biden administration removing the sanctions, some of the people said.
Presidents Joe Biden and Xi Jinping agreed that the countries needed to stabilize relations when they met at the G20 in Bali in November. But early efforts to kick-start high-level engagement were derailed after a suspected Chinese spy balloon flew over North America in early February.
The countries are negotiating visits to China by Secretary of State Antony Blinken, Treasury Secretary Janet Yellen and commerce secretary Gina Raimondo.
The Pentagon said it wanted ‘open lines of communication’ with Chinese military leaders but blamed China for the impasse.
Market implications
The news challenges market sentiment and weighs on the risk-barometer pair like AUD/USD. That said, the quote remains pressured around 0.6775 after posting multiple failures to cross the 0.6800 mark.
Also read: AUD/USD bulls move in as US Dollar softens on US CPI
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