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Donald Trump Spins 90 Day China Truce as 'Big Leap Forward'

06 Décembre 2018

Einar Tangen, a political analyst and investment banker based in Beijing says that the truce was "an excellent outcome", given the threats of escalation in months preceding the meeting.

Chinese Foreign Ministry spokesman Geng Shuang declined to comment Monday on Trump's statement, referring questions to "the relevant authorities".

However, Andrew Hunter, US economist for Capital Economics, said he is optimistic that the apparent "ceasefire" will hold, even though the two sides have been in similar positions before.

If no broader deal is reached within 90 days, the United States said it would hike tariffs on $200bn of Chinese goods from 10 to 25 percent.

The breakthrough came after a dinner meeting Saturday between President Donald Trump and Chinese leader Xi Jinping at the Group of 20 summit in Buenos Aires. China raised its tariff on auto imports from the USA from 15 percent to 40 percent in retaliation for Trump administration tariffs on imports from China. Jinping agreed to "negotiate immediately on forced technology transfer, intellectual property protection, non-tariff barriers, and cyber theft", according to the statement.

If the two sides can not reach agreement over these matters within the next 90 days, the United States will raise tariffs.

The truce was formed following a high-stakes working dinner on the sidelines of the G20 meetings in Buenos Aires, Argentina on December 1, 2018. Trump has also threatened to put tariffs on another $267 billion worth of Chinese imports.

Trump has long complained about China's unfair trade practices and blamed previous US leaders for failing to address the matter.

"President Xi and I have a very strong and personal relationship. But they have to deliver on this". Some critics of his policy have said that raising tariffs on Chinese goods is likely to increase prices for voters.

The uncertainty underscored the risk entailed by Trump's eagerness to strike deals without nailing down details in advance. "But now, China is on the verge of becoming a world superpower and challenging the USA position and economy". Financial markets were left struggling to digest talks that the White House portrayed as a major victory for the president. We are dealing from great strength, but China likewise has much to gain if and when a deal is completed. Furthermore, China agreed to start buying more agricultural products immediately - which presumably means scaling back some of its retaliatory tariffs, some of which had targeted Trump voters and more rural industries specifically.

Trump has appointed Lighthizer, one of the administration's most vocal China critics, to oversee the new round of trade talks with China, a White House official and a US official told Reuters on Monday. China responded with tariffs of its own on various USA exports.

The deal means the U.S.is unlikely to match China's 40-percent duties on light vehicles built in the USA, a move the American government has considered in recent weeks. Such a change would have to apply to all countries under World Trade Organization rules. "Level the field!" he said in a series of early morning tweet. "Farmers, I LOVE YOU!" he said. Both companies build cars for the Chinese market at US plants, which are thus subject to the Chinese tariffs.

Donald Trump Spins 90 Day China Truce as 'Big Leap Forward'