Home China China Blinks: U.S., China Strike Major Deal, Trade War Over

China Blinks: U.S., China Strike Major Deal, Trade War Over

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Another major news story the enemedia will ignore, China bows to Trump, agrees to buy $200 billion in American goods and services over two years.

The Dems are getting smaller and smaller.

U.S., China to Sign Deal Easing Trade Tensions

Agreement has U.S. suspending new tariffs in exchange for Chinese purchases of $200 billion in American goods and services over two years

By Lingling Wei, Wall Street Journal Jan. 15, 2020 8:29 am ET

WASHINGTON—The U.S. and China will sign the first phase of a trade deal that will include roughly $200 billion in Chinese purchases of American goods and services over the next two years, an agreement designed to ease the past two years of trade tensions between the economic superpowers.

People familiar with the negotiations said the pact is expected to include, among other provisions, a suspension of U.S. planned tariff increases on China’s exports to the U.S., in exchange for commitments by Beijing to step up orders of soybeans, pork and other U.S. farm products by $32 billion, of manufactured goods by around $80 billion, of energy products by some $50 billion and of services by about $35 billion. Details on specific product purchases in each of the categories won’t be released, the people said, as both sides feel such disclosure could risk distorting markets.

The agreement, to be signed Wednesday morning at the White House, would mark a pause in a trade war that has rattled global markets and businesses for nearly two years. President Trump has said he would later travel to Beijing to negotiate a broader pact, which would address other, knottier issues such as Chinese subsidies to domestic companies, particularly state-owned enterprises, and tactics the U.S. says Beijing uses to acquire American technological know-how.

Chinese officials haven’t confirmed any details of the second phase of the plan, and instead have said any future negotiations would depend on how the phase-one deal is implemented. Beijing’s leadership, under President Xi Jinping, has so far resisted U.S. efforts to get it to make any fundamental changes to its state-led economic model.

In exchange for China’s purchasing commitments, the Trump administration will cancel new tariffs on roughly $156 billion in Chinese imports that were set to take effect Dec. 15. It has also agreed to cut in half the existing 15% tariff rate on roughly $120 billion of Chinese goods that had been imposed on Sept. 1. But tariffs will remain on roughly $360 billion of annual Chinese imports to the U.S., a majority of the Chinese goods sold in America.

Even as the two sides prepared for a signing ceremony, there were indications of discrepancy in how Beijing and Washington interpret what they have agreed upon in terms of tariff reliefs. A statement issued by the state-run Xinhua News Agency on Dec. 13, confirming the phase-one deal, said that “both sides have reached consensus that the U.S. side will fulfill its commitments to phase out its additional tariffs on Chinese products,” while U.S. officials insist there is no such agreement.

With Beijing and Washington set to seal a first-stage trade pact, U.S. farmers are optimistic about the future. But some experts wonder if China’s commitment to the agreement will live up to the White House’s expectations. Photo: Scott Olson/Getty Images

The text of the first-phase deal is expected to be released Wednesday morning. Chinese Vice Premier Liu He, Mr. Xi’s chief trade negotiator, will be leading a 10-member delegation to attend the signing ceremony.

Myron Brilliant, executive vice president of the U.S. Chamber of Commerce, who met with Mr. Liu in Beijing on Monday, said the vice premier indicated “the phase-one deal helps the overall atmosphere of the U.S.-China relationship.” But even as the nations are reaching a compromise on trade, the Trump administration is pushing to restrict Chinese purchases of U.S. technology, particularly by the telecom giant Huawei Technologies Co.

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