‘’The trade war started with tariffs, and should end with the cancellation of tariffs’’
– Gao Feng (Spokesman of China’s Ministry of Commerce)
It seems that over the past two weeks there have been some serious negotiations regarding the trade tariffs between China and the US. Both countries are considering to decrease their number of tariffs in an attempt to end the ongoing trade war. Moreover, they are trying to establish a new trade deal.
According to the Chinese Ministry of Trade, a new trade deal will not be possible without lifting tariffs. Both countries would have to lift the same proportions. This has been China’s main request from the very beginning of the negotiations. The idea is to lift the tariffs in several phases. Financial Times states that the US is considering to lift the tariff of 15% on Chinese goods worth of approximately 112 billion dollars.
According to some of the latest news articles, the countries are almost done with the groundwork of a new trade agreement, a so called ‘’Phase one’’ deal. This agreement would also result in China buying more agricultural goods of the US and some Chinese sectors opening up for American companies.
Although both parties are close to a deal now, there is still the possibility that they will fail to come to an agreement. Previous negotiations also failed to establish an agreement. Furthermore, the presidents of both countries will have to make the final decision. This could be a new obstacle. For example, it is the question whether Trump is prepared to make these agreements, because they are not exactly considered to be a win to some of his voters.
The meeting between the Chinese president Xi Jinping and American president Donald Trump that was supposed to take place next week might now also have been delayed to December. This is because negotiations are still going on and there has not yet been found a suitable place to sign an agreement.
However, both countries consider these latest developments as something positive, and are very optimistic about the possibility of a new deal. It could be one step closer to a solution that is better for both. The two countries have been in conflict for over a year now. The end of the trade war might finally be in sight.
By: Jesse Derks