Trump economic adviser Larry Kudlow said Wednesday evening that President Trump and Chinese President Xi Jinping will meet next month to discuss trade, but also downplayed the prospects for the talks on the grounds that China’s trade practices make them an unreliable negotiating partner.

“You can’t operate in good faith knowing that you have to protect your own country with a country that steals your intellectual property rights – you can’t do that,” Kudlow said.

[More: White House says China trade talks have hit a great wall]

Kudlow, a longtime proponent of free trade, said that he believes that Xi doesn’t want a deal, and suggested that further escalation in the trade war was a likely outcome.

“If they’re not going to move, we will take additional actions as the president has said,” the National Economic Council director said at a dinner hosted by the conservative American Spectator magazine on Capitol Hill.

The Trump-Xi meeting would take place at the Group of 20 meetings next month in Argentina. So far, officials from the two countries have spoken only sporadically as the two sides have ramped up retaliatory tariffs against each other. To day, the Trump administration has imposed tariffs on $250 billion of Chinese goods, with another $267 billion threatened, and set levies on metals from around the world intended to punish China.

Although Kudlow long opposed tariffs in his roles as a commentator and business economist, he said that he fully agreed with the analysis that a confrontational approach to China is necessary, citing China’s persistent theft of U.S. businesses’ technology in particular.

One attendee challenged Kudlow to correct Trump's apparent belief that trade deficits are inherently harmful, noting that a trade deficit always implies a corresponding capital account surplus, meaning money flowing into the U.S.

Kudlow responded that the dispute with China is based on more than just trade balances, but also acknowledged the point. “Regarding the trade balances, and deficits on one side and capital on the other side, I can only say: One has tried...and I can also say to you I’m not the only one,” Kudlow said.