Trump aims to broker huge deals in China

US President Donald Trump speaks during a briefing in Dallas, Texas.
US President Donald Trump speaks during a briefing in Dallas, Texas. PHOTO: AFP

WASHINGTON • Representatives from about 40 companies are expected to accompany President Donald Trump on the first presidential trade mission to China next month and sign deals for billions of dollars in US investments.

Many of the deals, including an investment from China Petroleum, are expected be in the form of non-binding memorandums of understanding, not contracts. Among the firms tentatively listed as working on China-related deals in conjunction with the trip, according to a government document obtained by Bloomberg, are General Electric, Honeywell International, Westinghouse Electric, Alaska Gasline Development, Boeing and Qualcomm.

One of the biggest deals the Trump administration is negotiating is a multi-billion-dollar energy investment from Chinese oil and gas giant China Petroleum & Chemical, that would bring thousands of new jobs to hurricane-ravaged areas in Texas and the US Virgin Islands.

The deal is expected to be worth more than US$7 billion (S$9.5 billion) in investments in the US. The project would include construction of a 1,440km pipeline from the Permian oil field in western Texas to the Gulf Coast, as well as a storage facility there.

Separately, Sinopec would expand the oil storage facility known as Lime Tree in St Croix, according to a person familiar with the proposal. The deal will still need final approval from US and China officials.

The development deals in China may provide a political boost to Mr Trump, who focused much time on the campaign trail arguing that he was uniquely qualified to attract jobs and investment back to the US.

Commerce Secretary Wilbur Ross, who was in Beijing last month, said the US hoped there would be "very good deliverables" during Mr Trump's visit.

Ahead of the trip, the US and China announced on Friday an agreement to recognise each other's aircraft safety approvals. The deal may boost China's aviation industry and make it easier for companies like Boeing to sell products there.

Relations between the US and China have become strained as Mr Trump has repeatedly criticised the US trade deficit and demanded Beijing act more forcefully to prevent the development of North Korea's nuclear programmes.

The White House hopes Mr Trump's Nov 8-10 trip will help smooth some of those tensions while providing him with a signature accomplishment he can tout to supporters. His 10-day Asia trip will also include stops in Japan and South Korea, as well as the Asia-Pacific Economic Cooperation and Asean summits in Vietnam and the Philippines.

BLOOMBERG

A version of this article appeared in the print edition of The Sunday Times on October 29, 2017, with the headline 'Trump aims to broker huge deals in China'. Print Edition | Subscribe