China, US Delay Tariffs As "Goodwill" Act Ahead Of Fresh Trade Talks


In a tweet on Wednesday night, Trump said: "We have agreed, as a gesture of good will, to move the increased Tariffs on $250bn worth of goods (25% to 30%), from October 1st to October 15th". The new tariff hikes will instead begin on October 15.

A senior White House official said an interim deal was "absolutely not" on the table, not even in return for Chinese commitments on intellectual property and agricultural purchases. "We just don't see China willing to negotiate on them before the race for USA presidential elections really kicks off".

Meanwhile, The Wall Street Journal reported that China was seeking to narrow the scope of negotiations to trade matters - by excluding national security issues - in order to jump-start the talks.

The US think tank Trade Partnership predicts that due to the trade war US gross domestic product will be slashed by 1.01%, which will cost 2.16million US jobs, and household spending in the US will increase by $2294 annually.

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.

USA soybean exports to China, the world's top buyer, have plummeted during the bitter bilateral dispute, with swelling supplies sending prices to near-decade lows and US farmers struggling to turn a profit.

Benchmark Chicago Board of Trade soybean futures 0#S: jumped to one-month highs on Thursday, with the actively traded November contract SX9 in its steepest rally since May.

In related news, Fox Business notes, "The American Chamber of Commerce in Shanghai said Wednesday U.S. companies are steering business away from China at an increasing rate amid the escalating trade war between Washington and Beijing".

The items on the two tariff exemption lists - posted on the ministry's website - will not be subject to additional duties imposed by China on U.S. goods "as countermeasures to U.S. Section 301 measures", the ministry said in its statement.

The mutual steps to ease trade tensions between the world's two largest economies could influence working-level discussions expected at mid-month.

"The exemption could be seen as a gesture of sincerity towards the USA ahead of negotiations in October but is probably more a means of supporting the economy", ING's China economist Iris Pang wrote in a note. China had halted US farm-product imports in August after negotiations deteriorated.

In 2018, the United States goods trade deficit with China was $419.52 billion.

If the United States proceeds with its threat to impose tariffs on an additional $300billion (R4 trillion) worth of Chinese goods, it could lead to a global recession in as little as nine months - that is, according to the chief economist at Morgan Stanley, Chetan Ahya.

The Customs Tariff Commission of the State Council said in Beijing that it would waive for one year tariffs on 16 types of USA products, including shrimp; fish meal; whey, an ingredient in livestock feed; and cancer-treatment drugs.