Trump hails US-China relations amid trade detente

Trump hails US-China relations amid trade detente

The breakthrough came after a dinner meeting between President Donald Trump and Chinese leader Xi Jinping at the Group of 20 summit in Buenos Aires.

China increased an existing tariff on USA -made cars from 25 to 40 percent in July in retaliation toward tariffs on various Chinese-made goods entering the US announced by the Trump administration that month.

That's a misreading of what China agreed to do, at least as far as Chinese authorities are concerned. What will be more hard are the other issues that US officials said the two sides agreed on.

"It's an incredible deal", Trump told reporters aboard Air Force One, adding, "if it happens it goes down as one of the largest deals ever made".

In his Twitter roundup of weekend doings, Trump talked of halting the arms race. China will be opening up, China will be getting rid of tariffs. "We hope this 90-day tariff pause will lead to a positive resolution that removes tariffs altogether and improves US-China trade relations". It is part of the administration's response to General Motors closing plants and cutting jobs in the U.S. And Beijing agreed to reconsider a takeover by USA chipmaker Qualcomm that it had previously blocked.

White House economic adviser Larry Kudlow said Monday that plans were in the works to scrap subsidies for electric cars and other renewable energy items, Reuters reported. "Both sides should instead aim for substantive, measurable and commercially meaningful outcomes and a long-term engagement framework", the official said. "This changes the tone and direction of the bilateral conversation".

Chinese Ministry of Foreign Affairs spokesman Geng Shuang (耿爽) yesterday said that the Chinese and U.S. presidents instructed their economic teams to work toward removing all tariffs.

There were also differences on China's preferences of U.S. goods and on the timeline for a trade-deficit reduction. Washington accuses China of deploying predatory tactics in its tech drive, including stealing trade secrets and forcing American firms to hand over technology in exchange for access to the Chinese market.

Resolving the tariff war between the US and China is seen as crucial for American agriculture, particularly soybeans, America's largest export to China, which accounted for $12.4 billion in sales past year. Trump had planned to raise the tariffs on the $200 billion to 25 percent if he couldn't get a deal with Xi.

Xi Jinping
Xi Jinping

A total of $10.5 billion in new and used cars were shipped to China from the U.S.in 2017, according to the Census Bureau.

"It is unreasonable to assume that all challenges in the relationship can be resolved in 90 days".

Trump lobbed several angry tweets at GM, the largest USA automaker, last week after the company announced plans to cut as many as 15,000 jobs and cancel production at five plants in North America, saying in one that "we are are now looking at cutting all @GM subsidies", last Tuesday.

He said for the first time there was "a clear path" to reduce the USA trade deficit with China to zero. "This is the first time they've responded on very, very specific issues".

Joining other forecasters, economists at the Organization for Economic Co-operation and Development last week downgraded their outlook for global economic growth next year to 3.5 percent from a previous 3.7 percent.

The trade detente comes as stock markets have stabilized in recent days after a bruising autumn but remain well below the highs they hit earlier in the year. The direct result is that fentanyl has flooded the USA market, in turn becoming the primary driver of surging drug overdose deaths.

White House press secretary Sarah Sanders said China's decision to label the drug as a controlled substance means that "people selling Fentanyl to the United States will be subject to China's maximum penalty under the law".

China nixed the proposed takeover earlier this year, citing antitrust concerns, after US and European regulators approved the deal.




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