For now, President Trump won’t be raising tariffs on Chinese goods.
After a much talked about dinner meeting between the U.S. president and Chinese President Xi Jinping on the sidelines of the G20 summit in Buenos Aires, the two world leaders have agreed to what amounts to a 90-day truce.
And during that time—intended as the period within which the U.S. and China will complete negotiations on trade, addressing key issues like tariffs, intellectual property and forced technology transfer—Trump has agreed not to raise the current 10 percent tariffs on $200 billion worth of China-made goods to the higher 25 percent rate he had slated for Jan. 1, 2019. There was also no mention of adding new tariffs on another $267 billion of imports from China.
In a brief White House issued statement Saturday, White House press secretary Sarah Huckabee Sanders said both Trump and Xi called their encounter a “highly successful meeting.”
On trade, Sanders said, “President Trump has agreed that on January 1, 2019, he will leave the tariffs on $200 billion worth of product at the 10% rate, and not raise it to 25% at this time. China will agree to purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial, and other product from the United States to reduce the trade imbalance between our two countries. China has agreed to start purchasing agricultural product from our farmers immediately.”
Beyond just halting hikes on existing tariffs, Trump and Xi will discuss, as part of the next 90 days of negotiations, “structural changes” to China’s forced technology transfer practices and protection for intellectual property, plus non-tariff barriers and cyber intrusions, according to the White House statement.
But this weekend’s ceasefire doesn’t take the tariff threat entirely off the table.
“Both parties agree that they will endeavor to have this transaction completed within the next 90 days,” Sanders said. “If at the end of this period of time, the parties are unable to reach an agreement, the 10% tariffs will be raised to 25%.”
According to CNN, a Chinese state media report said the leaders of the world’s two largest economies reached “an important consensus” on “the direction for Sino-US relations in the near future.”
“If it happens it goes down as one of the largest deals ever made,” CNN reported Trump as telling reporters on Air Force One on the return from the G20 Summit. “It will have an incredibly positive impact on farming, meaning agriculture, industrial products, computers, every type of product.”