this is the us delegation, led by deputy trade representative jeffrey gerrish.y is going through difficult period, we see sky is darkening. the end china, they account for 40% of global gdp and they account for 2% global trade. how they resolve their differences is going to be very important, how global economy is going to shape this year. that was the world bank's senior economist. joining me is victoria hewson, senior counsel, international trade and competition unit at the institute of economic affairs: (1+1) what do you make of the world bank saying that? it's not surprising given the headwinds that have been reasonably clear over the last you will too. that ineffective man —— but have been affecting manufacturing investment and trade. they are also looking at things like borrowing and debt in emerging and developing economies. obviously, so much hangs on that relationship between the us and china which, as with scene, the rallies that with scene in the stock markets around the world this morning really coming out of this quite potentially. we will talk abou

trade representative jeffrey gerrish and will include david malpass.na will be represented at the vice ministerial level. meetingy -- the two day happens after beijing announced tax cuts on 700 goods at part of -- as part of its efforts to open up economy and lower costs for domestic consumers. analysts say chinese consumers fall short of trade representative lighthizer's expectations. the chinese will likely want the u.s. to remove the tariffs it has imposed, but sources say beijing suspects the u.s. will ask for more concessions before it agrees to do that. president trump has agreed to put on hold, at least temporarily, a scheduled increase in tariffs while the negotiation takes place. to be see whether weaker domestic economies and slumping stock markets in both the u.s. and china will be an added impotence to move forward -- impetus to move forward. >> james is the chief to be seer weaker domestic economies and slumping stock markets in both the u.s. and economist and we are listening. --is going to be important an important week for tone and what

the us delegation is led by deputy us trade representative jeffrey gerrish. soas university of london is with me now. good to have you on business live. how hopeful are you we will see progress this week?” how hopeful are you we will see progress this week? i think the chinese party will bring in something to the negotiation table this time. but i think it is very difficult for them to implement all the structure changes which is the focus of this meeting, i think. but i think they will make some progress because the pressure is now increasingly high for both sides, to find a solution. what has been the impact on the us economy, the chinese economy of these tariffs so far? if you look at the chinese economy, the slowdown has been there for some time. it will, we will see more negative impact of the trade brought in the manufacturing sector, as is we can see the evidence by looking at the pmi index which has been below 50 for some time. the chinese government is now cutting tax. they are stimulating the private sector and they are trying to double consumption

countries agreed to a truce to try to resolve their trade dispute that the trade representative jeffrey gerrish said led the talks on the u.s. side donald trump says he's optimistic about the new round of negotiations two sides will continue talks on tuesday while the u.s. says impose tariffs on two hundred fifty billion dollars worth of chinese goods since july it covers a wide range of industrial and consumer items from handbags to railway equipment china retaliated imposing tariffs on one hundred ten billion dollars worth of u.s. products including chemicals coal and medical equipment and soybeans but china's economy is already showing signs of strain sales of i phones are down house prices are falling and manufacturing profits have also dropped but while the trade talks were happening a u.s. navy ship sailed in near disputed islands in the south china sea china has lodged a complaint with the u.s. asking for the vessel to leave the area the guided missile destroyer was close the paracel islands which are claimed by china taiwan and vietnam dozens of trucks have been taking part in an exerci

trade representative jeffrey gerrish leading the representative today as well as the treasury undersecretary. china says it will be represented in today's and tomorrow's talks at the vice minister level. they are setting the bar lower so they are not aiming so high and tight -- in case talks do not go well. if talks go well then they will bring in the big guns. davos, januaryn 22 and january 25. haidi: it really kind of puts pressureext how much the economy is putting on policymakers going into these trade talks. stephen: absolutely. again, that comes back to the first question about the impetus. the chinese economy is feeling the pain right now and that reserve ratio requirement at the banks is indicative of the numbers we haven't seeing. i mentioned -- have been seeing. i mentioned the pmi numbers going below 50. there is weakness in the chinese economy. whether that will be the input is to lead to the significant reform the u.s. wants, that is yet to be seen. that is a longer-term scenario. haidi: stephen, thank you so much. shery: the partial government shutdown here in the u.s. is enter

we have jeffrey gerrish, the deputy u.s. trade representative arriving in beijing along with the treasury undersecretary. china says it will be represented in beijing at the vice ministerial level. , he metmind last may with steve mnuchin, they thought they had a deal. they announced the deal and donald trump tweeted two days earlier saying no deal. they are cautiously optimistic. donald trump speaking in front of the white house overnight saying that the talks have been going very well with china and that chinese economy is being hurt very badly by the tariffs. in his estimation, the fire is under the feet of the chinese right now. whether the u.s. is feeling the pressure from the perception that the turmoil at the u.s. markets is in part caused the lack of progress on the china front. that could add a little bit to the united states. nevertheless, they are meeting and talking. lead to talk set a higher level depending on the success of the next couple of days. markets looking for many wins if you will over the next few day

jeffrey 2k3w jeffrey gerrish is leading the delegation liu he met and may come to washington if all goesay, commerce secretary ross was on cnbc saying that u.s. trade policy is working and china's economy is suffering as a result >> what will come out of it is a resolution are we going to go the negotiated route or are we going to go and go on the original direction of higher tariffs? it's really a binary set of decisions. >> there's a report that president trump could meet with china's vice president the white house not confirming the schedule of meetings just yet. we'll see if they sit down and talk back over to you. >> i'm sure it's lots of interesting conversations that week not least between the chinese and the u.s. ylan, thank you for that. >> thank you. >>> all right. we have got 22 minutes here before the closing bell. solidly rallying here with the dow up 158 points. s&p up 24. that's good for almost a percent. small caps are really shining in today's action tech's doing well today, as well up next, an exclusive interview with larry summers with an alarming economic warning out

you have jeffrey gerrish leading the delegation. you have his treasury undersecretary also going. not the big guns. china will be represented at the vice ministerial level. go well go back to your corners and keep on talking over the phone or through diplomatic channels. if they do go well, i could be escalated to the higher levels. rishaad: it is about implementation at the end of the day. we have pledges in the's that have not been -- in the past that have not been adhered to. until march you have the time frame to get concrete pledges to have a deal. another not, we go into channel, if you will. large u.s. delegation wegoing to die bus -- davos, are hearing from various reports that trump and the vice president of china, the former corruption buster in china. another right-hand man if you will. that theso hearing economics are could meet with robert lighthizer as well in the upcoming weeks. these talks could potentially set the stage for these higher level meetings. rishaad: thank you stephen. marketst to our reporter who is in -- are the stars finally aligning for risky volati

deputy trade representative jeffrey gerrish is meeting to have prostive, constructive discussions.lbur ross in about 30 minutes right here on "squawk box. we'll be able to ask him about the state of those talks and so much more. also, big week for the fed we'll get fomc minutes then jay powell will be giving a speech happening in the last hour, eli lilly buying loxo for $8 billion. the second major deal in the industry following last week's big deal >>> all right. coming up, dom chu has your morning market movers. plus citigroup's robert buckland will be our guest. plus then at 8:00, wilbur ross will be our guest to discuss the government shutdown, trade, and much more. "squawk box" will be right back. for your heart... your joints... or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally discovered in jellyfish, prevagen has been shown in clinical trials to improve short-term memory. prevagen. healthier brain. better life. >>> time now for a look at what's moving in the premarket dom chu joins us now