Dec. 3, 2018-Meeting in in Buenos Aires, Argentina on the sidelines of the G20 summit over the weekend, Chinese President Xi Jinping and U.S. President Donald Trump agreed prevent a pending hike in tariffs scheduled to take effect in less than a month.
It was their first formal face-to-face meeting since Trump visited China in November of 2017.
“It’s an incredible deal,” Trump said to reporters on Dec. 2 on Air Force One. “It goes down, certainly — if it happens, it goes down as one of the largest deals ever made…. And what I’d be doing is holding back on tariffs. China will be opening up. China will be getting rid of tariffs.”
Timeout on Tariff Hikes
In effect, the agreement gives U.S.-Chinese negotiators 90 days to complete talks on the following trade issues:
- forced technology transfer
- intellectual property protection
- non-tariff barriers
- cyber intrusions and cyber theft
- and services and agriculture.
In the meantime, the United States will leave tariffs on $200 billion of Chinese goods at 10 percent, rather than raise them to 25 percent on January 1, 2019.
Xi emphasized that cooperation is the best option for both countries, according to a release by the Chinese Ministry of Foreign Affairs. China would “open its market, expand imports and resolve” trade issues according to the “needs of its domestic market and people.”
The White House press office said China will purchase more U.S. agricultural, energy, industrial, and other products.
Financial markets in the United States and China rose one percent Dec. 3 on the news.
U.S. Opioid Sales
Also significant is an agreement by Xi that China will begin designating the opioid drug called Fentanyl as a controlled substance. That means China would start subjecting its exporters of Fentanyl to maximum penalty under its law.
More Time
Negotiators have 90 days to make progress in talks. If they cannot reach agreement, the United States might raise tariffs to 25 percent at that time, according to the White House statement.
