Trump willing to consider interim deal

Cheryl Sanders
September 13, 2019

There have been positive signs this week in the trade conflict, now entering its second year, as Trump agreed to Beijing's request to delay one round of tariff increases on $250 billion worth of goods for two weeks, until October 15, after China agreed to spare some U.S. products from its retaliation.

A senior White House official said an interim deal was "absolutely not" on the table, CNBC reported.

If the U.S. 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.

Chinese trade negotiators at the minister level are expected to convene in Washington in mid-September, with more talks scheduled for early next month to be attended China's Vice Premier Liu He and Yi Gang, the governor of the People's Bank of China.

The purchases, totaling at least 600,000 tonnes, are slated for shipment from US Pacific Northwest export terminals from October to December, two traders with knowledge of the deals told the Reuters news agency. "But it's something we would consider, I guess".

However, he again warned that Trump will only accept a good deal, and is willing to raise tariffs if necessary.

Asian stocks rose on Thursday, while China's yuan currency was also up 0.27 percent in offshore trade, as investors hoped for a thaw in U.S.

The U.S. and China have slapped import taxes on hundreds of billions of dollars' worth of each other's products in a tariff war that has weighed on global trade and economic growth and created uncertainty for businesses deciding where to situate factories, find suppliers and sell their products. Neither side has specified a date for the meetings.

The gestures may ease tensions ahead of the negotiations, but some analysts don't see it as a signal that both sides are readying a deal. "An exemption list of just 16 items will not change China's stance", ING's Greater China economist Iris Pang said.

Over 5,000 types of US goods, including soybeans and pork, are still subject to duties of up to 25 percent.

In the US, factory activity unexpectedly contracted in August for the first time in three years, underscoring how slowing global growth and an escalating USA trade war with China are taking an even bigger toll on domestic producers.

More than 300,000 American jobs have been lost as a result of President Donald Trump's trade war with China, and another 600,000 could be destroyed if the conflict drags on for another year.

In July, the United States exempted 110 Chinese-made products from tariffs.

Beijing has said it would work on exempting some USA products from tariffs if they are not easily substituted from elsewhere.

-China trade war in August when he announced an increase in levies on Chinese goods.

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