USA – China and the United States of America have agreed to ease their stances in a bid to avoid escalation of tariff war that has since negatively impacted the nations’ agricultural and other trade.
Following the meeting between U.S. President Donald Trump and Chinese President Xi Jinping, the two leaders agreed to withdraw some of the tariffs imposed on various goods and commodities in the two world nations.
The US and China have reached a 90-day trade tariff ceasefire after the latter agreed to buy ‘very substantial’ amount of American goods.
According to the White House, the President is set to hold off on raising the tariff rate on US$200 billion of Chinese imports for 90 days to allow for talks to address US concerns on Chinese trade practises.
In exchange, the White House indicated, China “will agree to purchase a not-yet-agreed-upon, but very substantial, amount of agricultural, energy and other product from the United States to reduce the trade imbalance between the two countries.
China has agreed to start purchasing agricultural product from our farmers immediately.”
According to the agreement, if the 90-days period passes with no deal, the US will increase tariffs on the US$200 billion of goods from 10% to 25%.
“President Trump and President Xi have agreed to immediately begin negotiations on structural changes with respect to forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cybertheft, services and agriculture,” the White House said.
Chinese Foreign Minister Wang Yi said China had agreed to import more US goods would gradually solve the legitimate concerns of the US businesses.
Trade tensions between the two nations escalated when China in July imposed a 25% tariff on US soybeans.
The Asian country had indicated that it will carry on plans to levy tariffs on a range of American farm goods including soybeans and corn.
Tariffs on about US$34 billion of US imports were set to begin on July 6, covering agricultural products including: soy, corn, wheat, cotton, rice, sorghum, beef, pork, poultry, fish, dairy products, nuts and vegetables.
In April, the Asian nation started levying additional taxes on American fruit, nuts, pork and wine.
Some of the victims in the war for economic prosperity were farmers who rely on agricultural imports and exports.
In 2017, China’s agriculture imports from U.S. were worth US$24.1 billion, the People’s Daily reported and according Ministry of Agriculture and Rural Affairs data, that was about 19% of total farm imports worth US$125.86 billion.
China is a major destination of US soybean exports but the menacing trade war has seen it turn to Brazil for soybean.