Trump: Planned tariffs dropped
US, China reach modest trade deal
WASHINGTON — The Trump administration has dropped its plan to impose new tariffs on $160 billion of Chinese imports beginning Sunday under a modest interim deal that de-escalates a 17-month trade war between the world’s two biggest economies.
As part of the agreement announced Friday, the administration is also reducing its existing import taxes on about $112 billion in Chinese goods from 15% to 7.5%.
In return, U.S. Trade Representative Robert Lighthizer told reporters, China agreed to buy $32 billion in U.S. farm products over two years. Beijing has also committed to ending a long-standing practice of pressuring companies to hand over their technology as a condition of gaining access to the Chinese market.
Lighthizer said China had also agreed to lift nontariff barriers to the Chinese market for such products as beef, poultry, seafood, pet food and animal feed.
In all, the U.S. expects a $200 billion boost in exports over two years as a result of the deal.
“We expect the trade deficit to go down for sure,” Lighthizer said, adding that the deal will likely be signed the first week in January and take effect 30 days later.
”Everything is written,” he said. “Everything is completely finished.”
Yet the administration released no detailed paperwork on the agreement and said the text was still being translated between Chinese and English. In the past, the two sides had appeared to be close to firm agreements only to see negotiations fall apart.
The so-called Phase 1 agreement leaves some major issues unresolved, notably U.S. complaints that China unfairly subsidizes its own companies to give them an edge in world markets.
The deal does, however, at least temporarily defuse a conflict that has unnerved financial markets and hobbled global economic growth.
“This deal should go a long way in reversing the downward spiral in bilateral trade relations and increasing certainty for U.S. businesses,” said Wendy Cutler, a former U.S. trade negotiator who is now vice president at the Asia Society Policy Institute.