3 hrs ago
China and US Pursue Reciprocal Tariff Cuts Before Trump-Xi Summit
China and the United States are discussing lowering some taxes on goods traded between them.
Each country may reduce tariffs on about $30 billion worth of products.
Chinese officials hope the agreement can be reached soon.
The plan could be discussed when Donald Trump and Xi Jinping meet in Washington.
The countries are also working on a Board of Trade to manage their economic relationship.
Their earlier tariff fight caused both sides to raise taxes on imports.
Some analysts think a small agreement is more likely than a major trade deal.
They also say the plan might help the United States more because of the size of its exports to China.
China and the United States aim to reduce tariffs on $30 billion of goods from each side.
Chinese officials said negotiators hope to reach an agreement at an early date.
Donald Trump and Xi Jinping are expected to meet in Washington on September 24.
The tariff discussions are tied to plans for a bilateral Board of Trade.
Analysts said targeted reductions are more likely than a broad trade deal and could benefit the United States more.
- Who
- The governments of China and the United States, including Chinese leader Xi Jinping and U.S. President Donald Trump.
- What
- Negotiators are seeking reciprocal tariff reductions covering $30 billion in goods from each country.
- Where
- The leaders are expected to meet in Washington; the negotiations concern trade between China and the United States.
- When
- The announcement came Thursday; Trump and Xi are expected to meet on September 24, while the current tariff truce expires November 10.
- Why
- The tariff reductions are part of efforts to stabilize bilateral relations and establish a Board of Trade.
Optimistic Official View
Cautious Analyst View
Prospects for an agreement
Optimistic Official View
Chinese officials said both sides hope to reach reciprocal tariff reductions at an early date, potentially around the leaders' summit.
Cautious Analyst View
Barclays said the scope for a broad trade deal is limited and that targeted tariff reductions are more likely.
Economic significance
Optimistic Official View
The agreement could help stabilize relations and reduce tariffs on equivalent amounts of goods.
Cautious Analyst View
Gary Ng said the overall trade significance would be more limited because China and the United States have already reduced their mutual trade reliance.
Who benefits more
Optimistic Official View
The proposal is presented as reciprocal, with both countries reducing tariffs on $30 billion of goods.
Cautious Analyst View
Ng said the arrangement could benefit the United States more because $30 billion is a larger share of U.S. exports to China than of Chinese exports to the United States.
Key facts
- Proposed coverage
- $30 billion in goods from each side
- Expected summit
- Donald Trump and Xi Jinping are expected to meet in Washington on September 24
- Trade framework
- The tariff talks are linked to creating a U.S.-China Board of Trade
- Current truce
- The tariff truce is set to expire on November 10
- Targeted goods
- The proposed reductions would focus on equivalent amounts of nonsensitive goods
- Potential imbalance
- $30 billion represents about 28% of U.S. exports to China and about 10% in the other direction, according to economist Gary Ng
Quotes
Guo Jiakun
Chinese Foreign Ministry spokesperson
“Leaders’ diplomacy plays an irreplaceable strategic guiding role in China-U. S. relations”
deccanchronicle.com
Barclays Bank
Financial institution cited in a research note about the upcoming Trump-Xi meeting
“Trade will be front and center at the summit”
deccanchronicle.com
Sources
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