U.S., China clinch trade deal that averts new tariff hike: media
WASHINGTON, Kyodo - The United States has agreed on a trade deal with China that will suspend a tranche of tariffs on Chinese goods set to kick in on the weekend and reduce some of the existing tariffs that have been introduced in the tit-for-tat trade war, U.S. media said Thursday.
In exchange for reducing the tariff rate on many Chinese imports, the latest agreement calls for China to buy $50 billion worth of agricultural goods in 2020, along with energy and other goods, according to The Wall Street Journal.
The latest development came after weeks of apparent skirmishes over the details of the so-called phase-one deal between the two countries to bring a temporary truce in the trade war that has played out for more than a year.
Trump said on Oct. 11 that a phase-one deal had been agreed with China, which includes Chinese purchases of $40 billion to $50 billion worth of U.S. agricultural products annually, and better protections for intellectual property rights. A tariff hike planned in the same month was also canceled.
But as the two countries worked to finalize the deal, a rift was exposed over issues such as the lifting of tariffs already imposed on each other's goods and the size of the farm purchases.
The Trump administration has so far imposed punitive tariffs of up to 25 percent on around $360 billion of Chinese goods in an effort to address alleged intellectual property and technology theft by Chinese companies as well as to reduce the chronic U.S. trade deficit with China.
Trump had also threatened to impose 15 percent levies on items worth an additional $160 billion on Sunday, which, if implemented as planned, would have seen nearly all imports from China taxed.
The December tariff increase was feared to have been a potential drag on U.S. consumption, especially around the holiday shopping season, as many consumer goods including laptop computers, cellphones, toys and video game consoles would be affected.
The Wall Street Journal said U.S. Trade Representative Robert Lighthizer and Chinese Ambassador Cui Tiankai are expected to sign "at least the outlines of a deal on Friday," quoting a person familiar with the matter.
Trump has fueled optimism about Washington reaching a deal with Beijing, tweeting Thursday morning, "Getting VERY close to a BIG DEAL with China. They want it, and so do we!"
Trump is apparently eager to claim a major trade victory to boost his prospects of re-election in 2020, while concerns have been growing over the potential impacts of the spiraling tit-for-tat tariff war on the world's two largest economies. (Kyodo)