U.S.-China trade deal swaps tariff rollbacks for farm, energy purchases

U.S.-China trade deal swaps tariff rollbacks for farm, energy purchases
  • Clock-gray 01:28
  • calendar-gray 14 December 2019

The United States and China cooled their trade war on Friday, announcing a “Phase one” agreement that reduces some U.S. tariffs in exchange for increased Chinese purchases of American farm products and other goods, APA reports citing CNBC.

Beijing has agreed to buy $32 billion in additional agricultural goods over the next two years, U.S. officials said, from a baseline of $24 billion purchased in 2017, before the trade war started. China would also ramp-up purchases of U.S. manufactured goods, energy, and services.

The United States would suspend tariffs on Chinese goods due to go into effect on Sunday, and reduce others, officials said. A deal is expected to be signed the first week of January in Washington by principal negotiators.

U.S. President Donald Trump tweeted Friday morning “We have agreed to a very large Phase One Deal with China.” Officials in China have “agreed to many structural changes and massive purchases of Agricultural Product, Energy, and Manufactured Goods, plus much more,” he said.

During a later news conference in the White House, Trump said he thought China would hit $50 billion in agricultural purchases.

In a press conference Friday night in Beijing, Chinese officials said the two countries have achieved major progress in their phase one trade negotiations, and agreed on the text of a deal, but offered no specific details on the amount of U.S. goods Beijing had agreed to buy.

The agreement was announced as the U.S. House Judiciary Committee voted in Washington to charge Trump with abuse of power and obstruction during an impeachment inquiry.

Some U.S. business groups hailed the deal as an end to uncertainty that’s slowed global growth; critics questioned whether the trade war had been worth the job losses and drop in sales.

U.S. markets have gyrated on rumors and leaks about the trade deal in recent months, but were muted on Friday on news it had been agreed.

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