China trade war begins to thaw as new tariffs halted
- Lynette Rhodes
Trump past year declared the opioid crisis a public health emergency in the United States and brought up the issue with Xi when the two leaders met in Beijing in November 2017.
There was no immediate USA confirmation of the outcome of the talks, but Chinese state TV said: "No additional tariffs will be imposed after January 1, and negotiations between the two sides will continue".
China, which has already slapped tariffs on US$110 billion in U.S. goods, is likely to retaliate, ramping up a conflict that has already rattled financial markets and caused forecasters to downgrade the outlook for global economic growth.
Deep divisions between the United States and China surfaced last month at the Asia-Pacific Economic Cooperation summit in Papua New Guinea. The 10% tariffs have been in place since September, and there's been no meaningful progress on talks since then.
Once that 90 days is up, the 10% tariffs will increase to 25% if no agreement has been reached. Trump had threatened to do that, and possibly add tariffs on $267 billion of imports, if there was no progress in the talks.
USA officials for years have been pressing the Chinese government to take a tougher stance against fentanyl, and most US supply of the drug is manufactured in China.
Trump met with Xi in Argentina on Saturday in a bilateral during the G-20 summit.
Trump, as often in his diplomatic dealings, appears to consider his personal chemistry with Xi the most important factor in the success of the negotiations. He struck a positive note as he sat across from Xi, despite the USA president's earlier threats to impose new tariffs on Chinese imports as early as the next year.
Xi replied referencing the men's "personal friendship" and that they must cooperate for "world peace and prosperity".
That President Xi agreed to designate fentanyl a controlled substance, meaning that Chinese selling the powerful synthetic drug to the U.S. will be subject to maximum penalties, is also important to President Trump, who has made fighting America's raging opioid epidemic a priority.
The White House said that China would subject fentanyl makers to the "maximum penalty under the law".
China "is open to approving the previously unapproved" deal for U.S. company Qualcomm Inc to acquire Netherlands-based NXP Semiconductors "should it again be presented".
"This was an incredible and productive meeting with unlimited possibilities for both the United States and China", Trump said in a statement released by the White House.
US President Donald Trump has said he hopes to meet North Korean leader Kim Jong-un in 2019, as early as January or February.
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This led some lawmakers to call for the U.S.to take a tougher stand against Saudi Arabia. This website is not intended for users located within the European Economic Area.
French leader Emmanuel Macron told reporters that the World Trade Organization, the body that regulates trade disputes, needed to be modernised.
Officials expressed relief that agreement on the summit communique was reached after negotiators worked through the night to overcome differences over language on climate change.
In comments last week, Trump referred to China as "ripping off our country for many, many years".
China's Vice Commerce Minister Wang Shouwen said that China and the United States also decided not to impose new tariffs on other products. Numerous countries have filed litigation at the WTO to contest the levies. The European Union is also pushing for reform at the WTO.
The non-binding agreement, negotiated in all-night talks, capped the two-day G20 summit in Buenos Aries.
A Chinese official meanwhile said "consensus is steadily increasing" but differences remained.
But it stopped short of agreement on the two biggest challenges facing the G20: The future of world trade and climate change.
"By withdrawing from the Paris Agreement, the USA gains itself more emission space and lower mitigation costs while squeezing other countries' emission space and raising their mitigation costs, and this will in turn make it more hard and expensive to achieve the 2 °C target of the Paris Agreement", reads a December 2017 study in the journal Advances in Climate Change Research.
China also pushed back in talks on steel, South Africa objected to language on trade, Australia did not want the statement to be too soft on migration and Turkey anxious it would push too far on climate change, according to the officials.
FILE - Plastic bags of fentanyl are displayed at the U.S. Customs and Border Protection area at the International Mail Facility at O'Hare International Airport in Chicago, Nov. 29, 2017.
Leaders attending the G20 summit, however, applauded on Saturday after President Trump signed the joint communiqué at the close of the meeting in Argentina.
Aside from trade and climate change, Russia's seizure of Ukrainian vessels drew condemnation from G20 members.
The Russian leader had a more productive dialogue in Buenos Aires with Saudi Crown Prince Mohammed bin Salman.
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