China scraps some United States tariffs ahead of trade talks

Friday, 13 Sep, 2019

The soya development was another indication that trade tensions between Washington and Beijing may be easing, after hitting a low last month when China suspended all United States farm product purchases in response to threats by Trump to impose more tariffs on Chinese goods.

Trump administration officials have discussed offering a limited trade agreement to China that would delay and even roll back some U.S. tariffs for the first time in exchange for Chinese commitments on intellectual property and agricultural purchases, according to five people familiar with the matter.

The apparent cooling of the trade war couldn't come too soon for the United States, which has seen markets slump dramatically since the two countries started trading tariff hikes in earnest again last month.

Mr Trump has imposed or announced penalties on about 550 billion dollars (£445 billion) of Chinese products, or nearly everything the United States buys from China.

Donald Trump has said the planned increase in China tariffs next month has been delayed two weeks as a "as a gesture of good will". Trump delayed the tariff hike to October 15 in what Mnuchin called a "goodwill gesture to the Chinese".

China has released a list of 16 USA imports that will be exempted from tariffs in the ongoing trade war between the world's two largest economies.

"More than a quarter (26.5 percent) of the 333 respondents to AmCham's annual survey said they have redirected investment away from China over the past year, up 6.9 percentage points from 2018".

Also on Thursday, the U.S. Department of Agriculture (USDA) reported China bought 10,878 tonnes of U.S. pork in the week ended September 5, the most in a single week since May. China had halted USA farm-product imports in August after negotiations deteriorated.

"It's a work in progress", said Terry Sandven, a chief equity strategist at U.S. Bank Wealth Management, about the trade situation.

But experts have warned there are signs the USA is also feeling the pinch, with job creation slowing across major industries last month. Trump has threatened two more rounds of tariffs.

Polls show the trade war is not popular with many voters and farmers are increasingly angry over depressed commodity prices. The waivers, which take effect on Tuesday, are the first allowed by China.

"It is expected that China will be buying large amounts of our agricultural products!", he posted on his Twitter page.

Despite the goodwill gestures, the two sides remain far apart on fundamental issues, and officials continue to trade barbs.

Earlier Wednesday, Beijing announced exemptions for 16 categories of American products from punitive duties.