Economy

US, China agree not to raise tariffs on Chinese goods

US, China agree not to raise tariffs on Chinese goods

While the Trump administration emphasized trade issues such as a 90-day moratorium on raising tariffs and Xi's concession to buy "very substantial" amounts of USA goods, China focused on diplomacy, regional issues and an agreement to try to quickly resolve their differences. The fact that China made no mention of agriculture in its statement after the meeting may also increase trader concerns over whether these purchases will materialize.

"It's an incredible deal", Trump told reporters aboard Air Force One. "China's reform and opening-up's broad perspective recognises that the rest of the world does things differently", it said in its editorial.

To add to the growing tension, the U.S. is now blaming China for the opioid crisis as increasing numbers of Americans are dying after overdosing on synthetic drugs. And Beijing agreed to reconsider a takeover by USA chipmaker Qualcomm that it had previously blocked.

What pushed the two sides to the table?

Trump also canceled a Saturday news conference, citing respect for the Bush family following the death of former President George H.W. Bush. "Level the field!" Trump said.

It will be relatively simple for China's buyers of crude oil, LNG, coal and soybeans to re-enter the market and fix cargoes from the United States.

In China, auto dealers such as Grand Automotive, Pangda Automobile Trade and Sinomach Automobile climbed on the news, with some local carmakers falling back. Trump had planned to raise the tariffs on the $200 billion to 25 percent if he couldn't get a deal with Xi. -China trade dispute. However, 90 days is a short period for negotiations on complicated structural issues, and some agreement will be hard to verify beforehand. It also shows that Trump continues to be fixed on the so-called "trade deficit"-which has increased since his Chinese tariffs were imposed in July and sits at a record $300 billion over the first nine months of the year".

The timetable for China's lowering of tariffs below 40 percent remains unclear.

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The more skeptical and jaded of observers may conclude that it seemed Trump and China were once again talking past each other, and in 90 days time Washington and Beijing will find themselves more or less back where they are now.

The trade war had been a pall on global markets as the world's two largest economies exchanged rounds of increasingly severe tariffs.

The economic heavyweight warned that otherwise global growth could slow.

On the non-trade issues, Beijing was more open, announcing that China will tighten supervision of Fentanyl and review rules on the drug.

'It is hoped that the trade teams from both countries will reach as many practical agreements as possible and as quickly as possible to hasten China-US cooperation, ' the daily said.

Trump gave no details about the vehicle tariffs, and there was no immediate response from the Chinese government.

The weekend agreement indicates "dialogue will intensify", but China will need to "agree to very substantial measures" to reach an agreement, said Rajiv Biswas of IHS Markit in a report. China agreed to resume purchases of some US farm and energy commodities.

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However, Qualcomm said in a statement that it considers the matter closed. The agreement "is not a ceasefire, it's just a de-escalation", he said.

"On standard trade issues, this is where we were weeks ago", Derek Scissors, a China scholar at the American Enterprise Institute and sometimes adviser to the Trump administration, told The Washington Post.

Regarding the impact on agriculture, Trump claimed Chinese purchases would immediately make farmers "a very BIG and FAST beneficiary", although there is no agreement yet on agricultural issues.

The White House said Saturday the two sides would "immediately" begin talks on "structural changes" affecting forced technology transfer, intellectual property protection and cyber theft.

The US president did not send any subsequent tweets on Sunday explaining which auto tariffs would be removed, and which would be reduced.

But Mnuchin said, "I think there's no question the president's tariff strategy has worked".

Trump, who in recent months has harshly criticised China and accused it of meddling in United States elections, in the statement called his meeting with Xi "amazing and productive".

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