President Donald Trump agreed to restart trade negotiations with China after meeting with Chinese leader Xi Jinping on Saturday. After meeting with Xi during a Group of 20 summit in Osaka, Japan, Trump said he would scale back restrictions on Chinese telecom giant Huawei and delay slapping new tariffs on Chinese goods as talks resume between the two countries. Meanwhile, Trump said China would purchase U.S. farm products during coming negotiations and “tens of billions” in purchases under any trade accord.
Existing U.S. tariffs will remain, reports Jim Wiesemeyer of Pro Farmer. During a news conference, Trump said that China had agreed to buy a "tremendous" amount of U.S. farm and other products to reduce the trade imbalance and that the U.S. will give China a list of the goods it wants China to buy. China will resume at least some of its purchases of American farm goods, Trump said.
“As usual, commodity traders want answers to what's ahead following Saturday details from the confab,” Wiesemeyer says. “But also as usual, details are not yet known, including when the next talks will be held between the two nations, and on China purchases of U.S. farm products both during the time until talks are held and what China may commit to purchase if a final agreement is worked out.”
No timeline exists at this point for reaching a deal, but Trump and his top advisers have suggested that the two sides remained as far apart as they were when talks broke up in May.
Larry Kudlow, the director of the White House National Economic Council, said that the U.S. was hoping to capitalize on the progress made during talks that broke down in May, which he said had gotten the two countries 90% of the way to a deal.
Over the weekend, Trump told Fox News that Xi “wants to make a deal. I want to make a deal. Very big deal, probably, I guess you’d say the largest deal ever made of any kind, not only trade.”
China's foreign ministry quoted Xi telling Trump he hoped the U.S. could treat Chinese companies fairly.
"China is sincere about continuing negotiations with the United States ... but negotiations should be equal and show mutual respect," the foreign ministry quoted Xi as saying.
Some believe Xi won in the latest confab with Trump because China avoided the additional tariffs Trump had threatened and won the resumption of trade talks without having to accept the draft text that had been negotiated by the end of April, Wiesemeyer notes.
Others say that the truce allows the U.S. to continue collecting 25% tariffs on nearly half its imports from China. In addition, China agreed to resume buying U.S. farm goods after intermittently halting purchases over the past year to protest Trump’s tariffs.
“In reality, little has changed for now,” Wiesemeyer says. “Existing tariffs on Chinese goods remain in place, and Beijing won’t overhaul its economic model of subsidizing state-owned enterprises.”
More from Farm Journal's PORK: