Donald Trump delays tariff hike on Chinese goods citing trade talk progress

0
58

President Donald Trump said he would delay an increase in US tariffs on Chinese products thanks to the “productive” trade talks and that he and Chinese President Xi Jinping would meet to seal an agreement if progress continues.

The announcement was the clearest sign so far that China and the United States are closing an agreement to end a multi-month trade war that has slowed global growth and affected markets.

Trump had planned to raise tariffs to 25 percent from 10 percent of Chinese imports in the United States worth $ 200 billion if an agreement was not reached between the two largest economies in the world by Friday.

After a week of talks that lasted until the weekend, Trump said those rates would not go up at the moment. In a tweet, he said that progress had been made in areas of division that included the protection of intellectual property, technology transfers, agriculture, services and currency.

As a result, he said: “I will be delaying the increase in US tariffs which is now scheduled for March 1. Assuming that both parties make further progress, we will be planning a Summit for President Xi and me, in Mar-a-Lago, to conclude an agreement, a very good weekend for the United States and China! ”

Mar-a-Lago is owned by the president in Florida, where the two men have met before.

The president did not set a new deadline for the talks to end, but he told the US state governors that they met at the White House that there could be “a very important news for the next week or two” if all went well. the negotiations.

The White House did not provide specific details about the type of progress made. The official Chinese news agency Xinhua reported that the two sides made “substantial progress” on specific issues, citing the Chinese delegation in Washington.

Trump and Xi called a 90-day truce last year to give their advisors time to negotiate an agreement. The threat of rate increases represented a significant leverage for the Trump team.

“We can not be sure if this is a big cavern or a success because we do not know the details of what has been negotiated, but (…) agreeing to extend the negotiations a few more weeks is definitely in China’s interest,” Scott said. . Kennedy, an expert in China at the Center for Strategic and International Studies in Washington. “At this point, it is likely that the United States has achieved everything that will come out of China.”

The market strategist of J.P. Morgan Asset Management, Tai Hui, said the move suggested that both sides wanted a solution to the dispute and added that a further rate hike would have raised concerns about the growth outlook for the United States.

The markets, which have been sensitive to the dispute as it has slowed down world growth, and some trade associations in the United States applauded Trump’s decision.

The futures of the US stock index They opened higher Sunday night when operations began for the week. The futures of the S & P 500 e-mini rose after Trump’s tweets in the trade, suggesting that Wall Street would open positively on Monday morning.

Asian stocks climbed for a maximum of five months and the Australian dollar, a proxy for China’s investments, gained 0.4 percent in the news.

Chinese stocks and the yuan rose at the start of trade, with the Shanghai Composite benchmark rising 2.1 percent, its highest level since August 1, and the yuan hit its strongest against the dollar since July 17th.

Trump is leaving for Vietnam on Monday, where he will hold a summit with North Korean leader Kim Jong Un. The president, who faces a battle for re-election next year, has presented his commitment to Kim and his forcefulness to China as key successes of his presidency.