Published: Fri, December 07, 2018
Markets | By Jeffery Armstrong

China 'confident' it can reach USA trade deal

China 'confident' it can reach USA trade deal

Over the weekend, a temporary truce was agreed between US President Donald Trump and Chinese President Xi Jinping at the G20 meeting in Argentina.

In return for the postponement in the higher United States tariffs, China agreed to step up its purchases of USA farm, energy and industrial goods, the White House said.

"The negotiations with China have already started".

Questions began to swirl after China's foreign minister read a statement Saturday in Buenos Aires that said Washington agreed to halt tariff hikes.

However, it still remains unclear when the purchases will take place and whether China will remove the retaliatory tariffs on these products or not; Beijing may instead choose to reimburse buyers for the tariffs paid as they have previously done so.

"Very strong signals being sent by China once they returned home from their long trip, including stops, from Argentina", Mr. Trump tweeted.

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Trump, in a series of Twitter posts, threatened to slap a range of import penalties on Chinese products if they did not make major changes in their economic relationship with the United States.

The US expects China to take immediate action to cut tariffs on US vehicle imports and end intellectual property theft and forced technology transfers as the two countries move toward a broader trade deal, Kudlow, director of the White House National Economic Council, said Monday.

President Donald Trump has declared victory in his trade war with China, claiming that Beijing had made "a big leap forward", but his declaration has reportedly left Chinese officials "puzzled and irritated".

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

The catch: the ceasefire is just for 90 days, after which the US could revert to its tariff-raising plan if it sees no progress on structural reform.

Trump, by postponing his threat to increase tariffs on $200 billion in Chinese goods to 25 percent from 10 percent, nodded to the Mnuchin wing of the administration, giving it a chance to prove that China is capable of reform. As part of his Twitter storm today, the United States president called himself "Tariff Man" and then proceeded to demonstrate his lack of basic understanding about how tariffs work, seemingly ignorant of the fact that tariffs are in effect a tax paid by domestic consumers, not foreign countries.

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Complicating the challenge, Trump's complaints strike at the heart of the Communist Party's state-led economic model and its plans to elevate China to political and cultural leadership by creating global champions in robotics and other fields.

"I don't think this meeting or anything else for that matter, right now, is moving toward vehicle tariffs", Kudlow told reporters Monday.

"We are confident in implementation ..."

Volkswagen Group CEO Herbert Diess talks with reporters after meeting with U.S. President Donald Trump at the White House, on December 4, 2018, in Washington. This is significant because China has never paid much attention to controlling the export of anything other than weapons and has even denied its obvious role in the US opioid crisis.

"The president has a point", Diess said, saying officials "tried to convince us to invest more into America and we are prepared to do this". We are right now taking in $billions in Tariffs. And at the opening of this week, the administration was already claiming progress with China on the purchase of $1.2 trillion worth of USA goods - even though White House officials couldn't supply any meaningful details. China's crude oil imports from the USA had ground to a halt.

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