U.S. to hold off on new China tariffs as talks restart

Tuesday, 02 Jul, 2019

In a lengthy statement on the two-way talks, China's foreign ministry quoted Xi as telling Trump he hoped the United States could treat Chinese companies fairly. China pledged to retaliate by hiking tariffs on $60 billion worth of USA imports in June.

"I would say probably even better than expected, and the negotiations are continuing".

The U.S. has accused Huawei of essentially being an arm of Chinese intelligence and has sought to pressure other countries to limit business with the company.

USA officials have alleged the company's products could be utilised for espionage by Beijing, a claim Huawei denies.

He said United States companies could sell equipment in cases "where there's no great national security problem" to the firm, which Washington fears poses security risks. "The national security concerns will remain paramount", he said.

It was always a bargaining chip in an ongoing trade war. "But I don't think this marks the turning of the tide", he said.

During the two-day summit, Trump held other high stakes meetings with leaders including Russian President Vladimir Putin, Japan's Prime Minister Shinzo Abe, German Chancellor Angela Merkel, India's Prime Minister Narendra Modi, Crown Prince of Saudi Arabia Mohammad bin Salman, and Turkish President Recep Tayyip Erdogan.

China, in turn, said the US's demands for business reform were unreasonable. As with past year, there were discussions on trade, including reform of the World Trade Organization (WTO). Hopefully in the end it's going to work out. Also, Mr. Trump confirmed that the US would not be adding tariffs on $300bn (£236bn) worth of Chinese imports.

In retaliation, China imposed tariffs on $110 billion in American goods, focusing on agricultural products in a direct and painful shot at Trump supporters in the U.S. farm belt.

Trump adviser Peter Navarro, known as the author of a book called Death by China, watched Mr Xi intently as he spoke. But the momentum didn't last.

Mr Abe visited Teheran two weeks ago to broker an uneasy peace between the two countries, though his attempt was complicated by an attack on two oil tankers - one Japanese - sailing through the Strait of Hormuz.

Getting them back on track could prove hard. "We are also relieved that President Trump has reconsidered his threat to impose additional tariffs, which would have accelerated harm to all American consumers, workers, and businesses of all sizes". A formal decision to lift the ban has not been made yet.

'We want to do something that will even it up with respect with trade, ' Trump said. Trump said it was a "tremendous amount" of goods that would soon start flowing to China as a result of the talks.

The Commerce Department put the firm on a blacklist because of the possibility its equipment could be used for cyberespionage.

Mr Trump suggested his administration would review the company's status on the so-called Entity List, which would clear the way for USA firms to sell it some components.

In the end, a deal of sorts was reached, with 19 members - minus the United States - agreeing Saturday to the "irreversibility" of the Paris climate deal and pledging its full implementation.

The US fears that systems built by Huawei - the world leader in telecom network equipment and number two smartphone supplier -could be used by the China government for espionage via built-in secret security "back doors". Trump, too, is confronted with an economy that, though still healthy, has looked a bit wobbly. -China trade war."Financial markets are unlikely to significantly reduce their expectations for Federal Reserve rate cuts despite global trade tensions easing".

Still, the freezing of new tariffs is likely to help the Chinese economy The trade war could slash one percentage point off China's economic growth this year, a top Chinese party official estimated in May.

This move is seen as a significant concession.

Putin told reporters that "we talked about it", but he did not elaborate.

Noting that global situation and China-US relations have changed considerably in the past four decades since the establishment of diplomatic relations, the Chinese president said that there is an unchanged fundamental fact that cooperation will benefit the two nations, while conflict will injure both sides.