Published: Tue, December 04, 2018
Finance | By Loren Pratt

China grain traders await lower tariffs before United States return

China grain traders await lower tariffs before United States return

President Donald Trump on Tuesday held out the possibility of an extension of the 90-day trade truce he and Chinese President Xi Jinping agreed on over the weekend that would freeze tariffs while a broader deal is negotiated.

The temporary freeze on further hostilities in the trade war between the United States and China had sparked a global rally in equity markets on Monday, pushing MSCI's all-country world index up 1.3 percent. "Unless extended, they will end 90 days from the date of our wonderful and very warm dinner with President Xi in Argentina", Trump said on Twitter.

China, for its part, also agreed to offset its massive trade imbalance with the U.S.by buying more, but not yet specified amounts, of energy products, agricultural, industrial and other products.

The White House said Xi said he was open to approving the previously unapproved Qualcomm-NXP deal should it again be presented to him.

White House officials have already begun backpedaling on President Trump's claim of an agreement with China to drop tariffs on United States cars entering the world's largest automotive market.

"When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so", he said.

US Trade Representative Robert Lighthizer will lead the talks to see "whether or not a REAL deal with China is actually possible", Trump tweeted on Tuesday. "MAKE AMERICA RICH AGAIN", he continued.


The negotiations for a final agreement have already begun, Kudlow said. The Trump administration has thus far applied tariffs to $253 billion worth of Chinese goods, and has threatened to apply 25 percent tariffs to another $267 billion worth of Chinese merchandise if this round of talks are unsuccessful.

The two leaders said they would hold off on imposing additional tariffs for 90 days starting on December 1 while they seek a solution to their trade disputes.

Trump last week ordered a separate review of China's 40 per cent tariff on auto imports from the USA, 25 percentage points of which is the result of Chinese retaliation against Trump's own tariffs on imports from China.

Treasury Secretary Steven Mnuchin is expressing optimism a trade agreement with China will soon be reached.

China offered more than $1.2 trillion in additional commitments on trade at the Xi-Trump dinner, Treasury Secretary Steve Mnuchin said on Monday.

And Treasury Secretary Steven Mnuchin said Tuesday on the Fox Business Network that China agreed to buy $1.2 trillion of USA products, but added, "if that's real" it would close the trade deficit with China and said "we have to have a negotiated agreement and have this on paper".

"It hasn't been signed and sealed and delivered yet", Kudlow said. On Sunday, Trump tweeted that China had agreed to cut import levies on American-made cars.

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