Trump Touts Benefits of China Trade Truce for U.S. Farmers

Trump Touts Benefits of China Trade Truce for U.S. Farmers

"This was an wonderful and productive meeting with unlimited possibilities for both the United States and China", he said in a statement.

After President Donald Trump announced steep tariffs on all imports of steel and aluminum, China slapped retaliatory tariffs on the U.S. The Trump administration responded with more tariffs targeting Chinese goods, and China replied with more tariffs of its own.

China will "reduce and remove" tariffs on cars coming into China from the United States following a "highly successful meeting" between the two nations leaders at the G20 summit.

In a series of tweets Monday, the president said his meeting with President Xi Jinping was an extraordinary one. Very good things will happen.

Trump last week ordered a separate review of China's 40 per cent tariff on auto imports from the U.S., 25 percentage points of which are the result of Chinese retaliation against Trump's own tariffs on imports from China.

In exchange, the two countries agreed to re-start talks on the U.S. concerns that triggered the dispute, including "forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft", according to the White House. He said relations have taken a big leap forward, adding, USA farmers will be a very big and very fast beneficiary of the deal after China agreed to purchase more agricultural equipment. With little progress made after a year, Trump was planning to hike his tariffs to 25 percent - and maybe even impose tariffs on the remaining $267 billion that China exports to American shores.

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On Monday, China's foreign ministry said economic teams in both countries had been instructed to "intensify talks" towards removing all tariffs following the G20 meeting.

The truce was formed following a high-stakes working dinner on the sidelines of the G20 meetings in Buenos Aires, Argentina on December 1, 2018.

Still, analysts cautioned the deal may have only bought some time for more wrangling over deeply divisive trade and policy differences, and said China's economy will continue to cool regardless under the weight of weakening domestic demand. The US has a 27.5 per cent tax on imported cars from China.

The principal agreement has effectively prevented further expansion of economic friction between the two countries and has opened up new space for a win-win cooperation.

Trump, speaking to reporters on Air Force One after the plane departed Argentina, said his agreement with Xi, will go down "as one of the largest deals ever made". With the White House warning that following the 90 days, with no agreements, the tariffs would rise to 25%, these two questions could possibly play the largest role in China's decisions.

This isn't the first time Trump has spoken in glowing terms of an incremental agreement to cool tensions he contributed to escalating. In the past, the USA has acted as a counterweight to China's claims, Now inconsistency in Trump's stance has added to tensions in the region. But, taken at face value, the president's comments should allow companies who build cars in America and sell them in China to breathe a sigh of relief. "Both sides avoided the worst-case scenario". "Farmers, I LOVE YOU!" he said. "Many people suspected that there may be a more disastrous outcome, this is definitely a relief".

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