Published: Wed, December 05, 2018
Economy | By

Business Lobby: Xi G20 Meeting to Help Prevent Trade War Escalation

Business Lobby: Xi G20 Meeting to Help Prevent Trade War Escalation

But now comes the hard work after a trade war truce was hammered out between United States President Donald Trump and China's head of state Xi Jinping at a dinner in Buenos Aires at the weekend.

President Donald Trump and top US officials said on Monday that a trade truce with China will lead to structural changes in Beijing's economic policies, including lower tariffs, lower non-tariff barriers and more market access for USA companies.

"I'm taking President Xi at his word, at his commitment to President Trump".

Tensions between the United States and China rose in May when the USA administration said it would levy extra taxes on $50 billion worth of Chinese goods, bringing that figure up to $250 billion over the next few months.

Prices on some Chinese new vehicles have soared as a result of the 40 percent tariffs the country has put on US -built cars and light trucks since the summer.

In a Tweet on Sunday night, Trump said: "China has agreed to reduce and remove tariffs on cars coming into China from the U.S. now the tariff is 40%".

The US and China have imposed billions of dollars of tariffs on one another's goods, posing risks to global trade and the world economy.

President Trump is touting great progress on trade talks with China, following his meeting with the Chinese president at the G20 summit.

"We don't yet have a specific agreement on that", Kudlow said, apparently contradicting Trump's tweet on the matter. They intend to start purchasing agricultural products immediately.

The US president did not send any subsequent tweets on Sunday explaining which auto tariffs would be removed, and which would be reduced.

"We absolutely need something concrete over these 90 days", Mnuchin added.

Chinese news outlets also claimed both sides plan to eliminate all tariffs, which doesn't appear in the US statement. And China's leader will likely expect compromise on complex territorial issues like Taiwan or the South China Sea before the ceasefire will begin to look like a full-fledged peace accord.

The US also wants Beijing to rein in high-technology industrial subsidies, open its markets to more foreign competition and take steps to cut a $375 billion (£283 billion) US goods trade surplus.

Asian stock markets opened higher on Monday in the wake of the truce, with Tokyo rising by one percent and Hong Kong and Shanghai rising by more than two percent.

"The resumption of talks between the U.S. and China is encouraging for our industry, as we are dependent on complex global supply chains for our marketplaces around the world. Level the field!" Trump said.

"The Chinese public needs to keep in mind that China-US trade negotiations [will] fluctuate".

Of China's US$51 billion of vehicle imports in 2017, about US$13.5 billion came from North America, including sales of models made there by non-U.S. manufacturers like BMW.

"As far as we can tell, there are big discrepancies between both sides' statements", he said in a research note. Qualcomm scrapped its US$44 billion plan to purchase NXP after failing to acquire approval from China's State Administration of Market Regulation, which oversees anti-monopoly regulations.

The BBC's Stephen McDonell reports that China "has pretty much given up nothing in this deal because the future tariffs threatened from the Beijing side were retaliatory in nature and only to be applied if the United State escalated".

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