Global Geopolitical Series: Trump-Xi consensus reached on trade but statements differ
- Author: Zachary Reyes Dec 03, 2018,
Dec 03, 2018, 19:56
Trump agreed not to raise tariffs rates for the $200 billion worth of Chinese goods from 10 percent to 25 percent as originally planned by January 1, 2019, after the two leaders reached consensus during their dinner meeting in Argentina to start negotiations that would address U.S. concerns on China's trade practices.
Trump has said he might consider raising tariffs on all remaining Chinese imports, or about $267 billion of goods.
In the first nine months of the year, China imported 3.2 million tons of US coal, the majority of this being higher-value metallurgical coal used in steelmaking.
So Trump could use a big good news story to take home with him from Argentina. The symbolism ahead of the Xi meeting was clear: the Trump administration has looked to find common cause with both nations in countering China's regional hegemony.
Ahead of the G20, Mr Trump had told U.S. media he expected to go ahead with plans to raise tariffs on $200b of Chinese goods - first introduced in September - to 25 percent (up from 10 percent) starting in January 2019. The president said in a tweet that China had "agreed to reduce and remove" the tariffs.
If the Chinese did eventually increase such purchases, it would be warmly welcomed in the U.S. Farm Belt, where producers of soybeans and other crops have been hurt by Beijing's retaliatory tariffs.
"This is the first time that we have a commitment from them that this will be a real agreement", Mnuchin told CNBC television, adding that the administration would know "very quickly" whether a deal can be documented.
Xi's government has announced a drumbeat of changes this year that Washington and other trading might have welcomed at another time as progress.
"My meeting in Argentina with President Xi of China was an extraordinary one", Trump said on Twitter.
"We will probably end up ending up getting something that will be good for China and the United States", Trump said. It is hoped the agreement reached on Saturday will be implemented by the two sides and Chinese and American working teams will meet the expectations of their leaders [by] normalizing trade relations between the countries.
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". We urge you to stand firm against China if meaningful concessions are not made.
The ceasefire follows months of tensions and tit-for-tat custom duties on hundreds of billions of dollars worth of goods that raised fears of an escalation harmful to the global economy. "And I think at some point, we're going to end up doing something which is great for China and great for the United States", Trump told reporters before the meeting.
The announcement that auto tariffs on US-made cars is another concrete step towards what Larry Kudlow, Trump's top economic adviser, has said is the goal of no tariffs or non-tariffs barriers between the two countries.
Chinese Foreign Minister Wang Yi said afterward in a statement that, as part of the agreement, China will tighten supervision of fentanyl and revise rules on the drug, while enhancing law enforcement work with the U.S.