Trump Praises China's 'Big Move' in Exempting Tariffs on Some US Goods

The long-running trade war between China and the US has seen them swap tariffs on goods worth hundreds of billions of dollars. AFP  Ina Fassbender

There have been positive signs this week in the trade conflict, now entering its second year, as Trump agreed to Beijing's request to delay one round of tariff increases on $250 billion worth of goods for two weeks, until October 15, after China agreed to spare some United States products from its retaliation.

"I deal with them and I know them and I like them", Trump said.

Thursday's soybean deals were the largest among private Chinese importers since Beijing raised import tariffs by 25% on USA soybeans in July 2018 in retaliation for US duties on Chinese goods.

Then a high-level Chinese delegation is likely to travel to Washington to meet with Mnuchin and U.S. Trade Representative Robert Lighthizer.

The US think tank Trade Partnership predicts that due to the trade war US gross domestic product will be slashed by 1.01%, which will cost 2.16million US jobs, and household spending in the US will increase by $2294 annually. "But it's something we would consider, I guess".

Trump said he hoped to reach a trade agreement with China following more than a year of tit-for-tat exchanges of tariffs that have roiled global markets. US equities and Asian stock futures advanced after news of the discussions.

China, which now relies on Brazil for most of its soybean imports, opened the door this week to imports of soybean meal from Argentina, which ranks third to Brazil and the U.S.as a soybean producer. Exact dates for the meetings have not been released.

"Chinese enterprises have started to inquire about the price of American farm goods including soybeans and pork", ministry spokesman Gao Feng said at a news briefing.


The gestures appear meant to reduce tensions ahead of the October negotiations over trade and technology.

China has raised duties on about $120 billion of USA products.

"The exemption could be seen as a gesture of sincerity towards the U.S. ahead of negotiations in October but is probably more a means of supporting the economy", ING's China economist Iris Pang wrote in a note.

The slight reprieve may be little comfort to American businesses that have had to struggle with trade uncertainties. Those target farm states that supported Trump in the 2016 presidential election. "He's prepared to raise tariffs if we need to raise tariffs".

Other soybean purchases over the past year have been made nearly exclusively by state-owned Chinese firms which are exempted from the steep import tariffs.

For two years, the Trump administration has sought to pressure China to make sweeping changes to its policies on intellectual property protection, forced transfers of technology to Chinese firms, industrial subsidies and market access.

Trump has said the protracted trade war is damaging China more than the United States.

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