United States President Donald Trump and Chinese President Xi Jinping have agreed to call off a mutual escalation in their countries’ trade dispute, easing tensions in a confrontation that has threatened to disrupt the global economy, reports Safety4sea.
Trump, Xi reach deal on tariffs
After months of the two nations being on the brink of an all-out trade war, the two Presidents have announced a trade deal following a face-to-face meeting during the Asia-Pacific Economic Cooperation (APEC) summit in South Korea. The agreement formalizes a framework deal that American and Chinese negotiators had reached earlier in the week. According to Chinese state media, Xi confirmed that both countries had reached a consensus.
The deal cancels Trump’s threat of a 100% tariff increase, immediately lowers the overall tariff rate on Chinese goods and further resolves, at least temporarily, several of the most contentious trade issues between the U.S. and China.
China’s Commerce Ministry stated that the U.S. agreed to suspend Trump’s 24% reciprocal tariff on China for another year. This tariff had been initially suspended for 90 days in May following a temporary truce, with multiple 90-day extensions since. The latest extension was set to expire on 10 November.
In addition, China will resume purchases of American soybeans, Trump confirmed. Previously, China, once the largest buyer of U.S. soybeans, had effectively halted new orders after Trump’s tariffs were introduced, severely impacting American farmers.
As reported, the agreement also postpones the U.S. Section 301 investigation into Chinese shipbuilding, which could have led to higher port fees on Chinese vessels and prompted retaliatory fees from China on U.S. ships. Both sides agreed to suspend these measures for one year.
However, while the deal provides a temporary sigh of relief for businesses unsettled by months of reciprocal trade actions, it does not remove existing trade barriers and leaves several points of contention unresolved.
Under the framework, China further agreed to defer its planned export controls on rare earths, while the U.S. will drop its threatened 100% tariff on Chinese goods. Trump also announced a reduction in a 20% fentanyl-related tariff to 10%.
Regarding rare earths, China will suspend its licensing measures for at least one year, according to a statement from the Chinese Ministry of Commerce.
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Source: Safety4sea
