China Announces Initial Trade Agreement With U.S.

China Announces Initial Trade Agreement With U.S.
By: WNG NYT Posted On: December 13, 2019 View: 46

China Announces Initial Trade Agreement With U.S.

BEIJING — China announced on Friday that it had agreed on an initial trade deal with the United States, marking a significant de-escalation in the 19-month tariff war that has rattled the world economy.

Wang Shouwen, China’s vice commerce minister, said at a news conference in Beijing that the two sides had made “significant progress” and that the agreement would result in the United States removing some of the tariffs it has placed on $360 billion worth of Chinese goods. Those tariffs would come off in phases, he said, and would include additional exemptions for some Chinese exports.

“This will create better conditions for China and the United States to strengthen cooperation,” Mr. Wang said.

The agreement includes a commitment by China to buy more agriculture products and to strengthen laws protecting foreign companies operating there, as well as sections covering intellectual property and currency. Mr. Wang said both sides have agreed to complete legal reviews as quickly as possible and will work out arrangements for an official signing.

The White House has not formally announced an agreement but people familiar with the matter said the two sides had agreed on a deal that would require China to boost purchases of farm products, give American firms more freedom to operate in China and protect American intellectual property.

In return, President Trump is expected to rollback some of the tariffs being collected on $360 billion of Chinese goods and delay or cancel another round of tariffs planned for Sunday. Some advisers to the White House said the Chinese had agreed to buy $50 billion worth of American farm products next year.

The deal came as a relief of investors, who have been haunted by the steady drumbeat of tariffs that have depressed business sentiment and stirred economic uncertainty. The S&P 500 was up slightly in early-morning trading.

A deal will also give Mr. Trump another trade win that he can tout heading into his re-election campaign and as Congress forges ahead with his impeachment. The agreement came on the same week that the administration agreed with House Democrats to revise the terms of a trade pact with Canada and Mexico.

This is a developing story. It will be updated.

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