Trump says China trade talks 'back on track,' new tariffs on hold

[snoop1130]

Trump says China trade talks 'back on track,' new tariffs on hold

by Roberta Rampton, Michael Martina

 

U.S. President Donald Trump meets with China's President Xi Jinping at the start of their bilateral meeting at the G20 leaders summit in Osaka, Japan, June 29, 2019. REUTERS/Kevin Lamarque

 

OSAKA (Reuters) - The United States and China agreed on Saturday to restart trade talks after President Donald Trump offered concessions including no new tariffs and an easing of restrictions on tech company Huawei in order to reduce tensions with Beijing.

 

China agreed to make unspecified new purchases of U.S. farm products and return to the negotiating table, Trump said. No deadline was set for progress on a deal, and the world’s two largest economies remain at odds over significant parts of an agreement.

 

The last major round of talks collapsed in May.

 

Financial markets, which have been rattled by the nearly year-long trade war, are likely to cheer the truce. Washington and Beijing have slapped tariffs on billions of dollars of each other’s imports, stoking fears of a wider global trade war. Those tariffs remain in place while negotiations resume.

 

“We’re right back on track,” Trump told reporters after an 80-minute meeting with Chinese President Xi Jinping at a summit of leaders of the Group of 20 (G20) major economies in Osaka, Japan.

 

“We’re holding back on tariffs and they’re going to buy farm products,” Trump said, without giving details about the purchases.

 

Trump tweeted hours later that the meeting with Xi went “far better than expected.”

 

“The quality of the transaction is far more important to me than speed,” he tweeted. “I am in no hurry, but things look very good!”

 

The U.S. president had threatened to slap new levies on roughly $300 billion of additional Chinese goods, including popular consumer products, if the meeting in Japan proved unsuccessful. Such a move would have extended existing tariffs to almost all Chinese imports into the United States.

 

In a lengthy statement on the two-way talks, China’s foreign ministry quoted Xi as telling Trump he hoped the United States 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.

 

Trump offered an olive branch to Xi on Huawei Technologies Co [HWT.UL], the world’s biggest telecom network gear maker. The Trump administration has said the Chinese firm is too close to China’s government and poses a national security risk, and has lobbied U.S. allies to keep Huawei out of next-generation 5G telecommunications infrastructure.

 

Trump’s Commerce Department has put Huawei on its “entity list,” effectively banning the company from buying parts and components from U.S. companies without U.S. government approval.

 

But Trump said on Saturday he did not think that was fair to U.S. suppliers, who were upset by the move. “We’re allowing that, because that wasn’t national security,” he said.

 

CHEERS FROM CHIP MAKERS

 

Trump said the U.S. Commerce Department would study in the next few days whether to take Huawei off the list of firms banned from buying components and technology from U.S. companies without government approval.

 

China welcomed the step.

 

“If the U.S. does what it says, then of course, we welcome it,” said Wang Xiaolong, the Chinese foreign ministry’s envoy for G20 affairs.

 

U.S. microchip makers also applauded the move.

 

“We are encouraged the talks are restarting and additional tariffs are on hold and we look forward to getting more detail on the president’s remarks on Huawei,” John Neuffer, president of the U.S. Semiconductor Association, said in a statement.

 

Republican U.S. Senator Marco Rubio, however, tweeted that any agreement to reverse the recent U.S. action against Huawei would be a “catastrophic mistake” and that legislation would be needed to put the restrictions back in place if that turned out to be the case.

 

Last month, Rubio and Democratic U.S. Senator Mark Warner urged Trump to not use Huawei as a bargaining chip for trade negotiations.

 

Huawei has come under mounting scrutiny for over a year, led by U.S. allegations that “back doors” in its routers, switches and other gear could allow China to spy on U.S. communications.

The company has denied its products pose a security threat. It declined to comment on the developments on Saturday.

 

The problems at Huawei have filtered across to the broader chip industry, with Broadcom Inc (AVGO.O) warning of a broad slowdown in demand and cutting its revenue forecast.

 

Trump said he and Xi did not discuss the extradition proceedings against Meng Wanzhou, Huawei’s chief financial officer, who was arrested in Canada in December on charges alleging she misled global banks about Huawei’s relationship with a company in Iran.

 

RELIEF AND SCEPTICISM

 

Scores of Asia specialists, including former U.S. diplomats and military officers, urged Trump to rethink policies that “treat China as an enemy,” warning that approach could hurt U.S. interests and the global economy, according to a draft open letter reviewed by Reuters on Saturday.

 

Investors, businesses and financial leaders have for months been warning that an intractable tit-for-tat tariff war between the United States and China could damage global supply chains and push the world economy over a cliff.

 

International Monetary Fund Managing Director Christine Lagarde on Saturday urged G20 policymakers to reduce tariffs and other obstacles to trade, warning that the global economy had hit a “rough patch” due to the trade conflict.

 

Although analysts cheered a resumption of talks between Washington and Beijing, some questioned whether the two sides would be able to build enough momentum to breach the divide and forge a lasting deal.

 

“Translating this truce into a durable easing of trade tensions is far from automatic ... especially as what’s in play now extends well beyond economics to include delicate national security issues of both immediate- and longer-term nature,” said Mohamed El-Erian, chief economic adviser at Allianz.

 

The United States says China has been stealing American intellectual property for years, forces U.S. firms to share trade secrets as a condition for doing business in China, and subsidizes state-owned firms to dominate industries.

 

China has said the United States is making unreasonable demands and must also make concessions.

 

The negotiations hit an impasse in May after Washington accused Beijing of reneging on reform pledges made during months of talks. Trump raised tariffs to 25% from 10% on $200 billion of Chinese goods, and China retaliated by raising levies on a list of U.S. imports.

 

-- © Copyright Reuters 2019-07-02

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[pegman]

China knows the closer to the USA election it gets the more desperate Trump becomes. Xie has played this beautifully. The American hard liners will be moved aside (to Outer Mongolia? 555) shortly and the son-in-law will be brought in to close a weak deal. Same thing happened before the mid-terms and New NAFTA.

[AlexRich]

Trump, the great negotiator, is anything but ... I suspect he'll call off hostilities until he can secure re-election, and the China technology team will be doing a "Russia", manipulating social media to thwart his 2020 campaign. 

[NightSky]

Why in the World is Ivanka Trump at this meeting, does she need to place a new order for her shoes business?

 

Nepotism in plain sight!

Edited July 2, 2019 by NightSky

[lannarebirth]

Tariffs aren't a particularly good tool for adjusting the balance of trade. Personally I think tariffs should be much much higher be ause of human rights and environmental reasons. Thegoal shoiuld be to either change the behaviour or to not do business with the country at all, which would suit me fine.

 

One of hundreds of deplorable acts:

 

https://www.businessinsider.com/china-forces-tourists-install-malware-phone-scanning-app-xianjiang-border-2019-7

[meand]

Opinions may differ on this, but I personally think it is fairly well known the Chinese are some of the best negotiators on the planet. At all levels. 

[Roadman]

So the American taxpayer has for the last six months subsidized the farming community and lost billions of dollars in trade income from China and seen China go to other global suppliers to arrive back at the point before tariffs were introduced. Bright spark who thought up that strategy. 

[bristolboy]

1 hour ago, Roadman said:

So the American taxpayer has for the last six months subsidized the farming community and lost billions of dollars in trade income from China and seen China go to other global suppliers to arrive back at the point before tariffs were introduced. Bright spark who thought up that strategy. 

Actually not back at the point before tariffs were introduced. Rounds 1 & 2 of tariff impositions remain. Just round 3 was put on hold.

[Tug]

Tell me are we tired of winning yet

[Scott]

Troll post removed.  

[bristolboy]

5 hours ago, lannarebirth said:

Tariffs aren't a particularly good tool for adjusting the balance of trade. Personally I think tariffs should be much much higher be ause of human rights and environmental reasons. Thegoal shoiuld be to either change the behaviour or to not do business with the country at all, which would suit me fine.

 

One of hundreds of deplorable acts:

 

https://www.businessinsider.com/china-forces-tourists-install-malware-phone-scanning-app-xianjiang-border-2019-7

Some people think that China is basically a manufacturer of the kind of cheap goods you see at Walmart. Here's an instructive example of why that's not the case. As you may be aware, Apple moved production of it Mac Pro to the USA several years ago. It has now decided to move it back to China despite the current political situation. To anyone who believes that not doing business with China is an economically feasible proposition I highly recommend this article:

A Tiny Screw Shows Why iPhones Won’t Be ‘Assembled in U.S.A.’

https://www.nytimes.com/2019/01/28/technology/iphones-apple-china-made.html

Edited July 3, 2019 by bristolboy

[lannarebirth]

22 minutes ago, bristolboy said:

Some people think that China is basically a manufacturer of the kind of cheap good you see at Walmart. Here's an instructive example of why that's not the case. As you may be aware, Apple moved production of it Mac Pro to the USA several years ago. It has now decided to move it back to China despite the current political situation. To anyone who believes that not doing business with China is an economically feasible proposition I highly recommend this article:

A Tiny Screw Shows Why iPhones Won’t Be ‘Assembled in U.S.A.’

https://www.nytimes.com/2019/01/28/technology/iphones-apple-china-made.html

 

I don't care where Apple makes it's computers or if they make them at all. What I said is if they are made in China and sold in the US a huge tariff should be paid by the consumer (which they may be increasingly less inclined to do) for supporting a human rights abusing and environment destroying regime. They should pay the true cost of the good, which is much much more than what the sticker shows.

[bristolboy]

1 minute ago, lannarebirth said:

 

 They should pay the true cost of the good, which is much much more than what the sticker shows.

Should that apply to all goods, imported or domestic, or just to Chinese ones?

[Thailand]

Xi and the little fat fella from NK have had a great week at the expense of Trump. Would love to be the fly on the wall when they are talking about him.

[lannarebirth]

41 minutes ago, bristolboy said:

Should that apply to all goods, imported or domestic, or just to Chinese ones?

 

Probably a scale should be applied.  I wouldn't think domestic goods would apply as they are subject to standards and laws by which we are measuring theother nations against. That's not to say domestic standards couldn't be improved. Japan and the EU have much more stringent food standards and many US foodstuffs are not saleable there. That seems fair to me.

[Srikcir]

1 hour ago, lannarebirth said:

a huge tariff should be paid by the consumer (which they may be increasingly less inclined to do) for supporting a human rights abusing and environment destroying regime.

Which would not be allowed under WTO rules and regulations to which the U.S. is a signatory.

That's why all of Trump's tariff wars with allies and adversaries have been predicated on the excuse of "national security" that is a specific exemption under WTO. Albeit Trump contradicts his own excuses.

[Srikcir]

7 hours ago, NightSky said:

Why in the World is Ivanka Trump at this meeting, does she need to place a new order for her shoes business?

 

Nepotism in plain sight!

Maybe she was being "offered" as part of any trade deal?

Clearly Xi is not her father.

[Traubert]

7 hours ago, lannarebirth said:

 

I don't care where Apple makes it's computers or if they make them at all. What I said is if they are made in China and sold in the US a huge tariff should be paid by the consumer (which they may be increasingly less inclined to do) for supporting a human rights abusing and environment destroying regime. They should pay the true cost of the good, which is much much more than what the sticker shows.

There is little fundamental difference between China and the US when it comes to human rights (whatever that means) and environmental pollution.

[bristolboy]

17 minutes ago, Traubert said:

There is little fundamental difference between China and the US when it comes to human rights (whatever that means) and environmental pollution.

I know what you mean. Like that social credit thing that exists in China and the USA. You know that system whereby if the chinese governemtn decides you are too anti-social, you can't fly or take trains, you can't get loans. I haven't actually seen that in the USA, but since you say that there's little fundamental difference, I guess that system exists there, too.

[bristolboy]

36 minutes ago, mike324 said:

Not sure who is worse Trump or his supporters. I believe Trump clearly knows what he is doing, he clearly knows he has support over anything he does because his supporters don't seem to care. Case in point - he said the economic and job data were all fake under Obama, yet he is using the same data and hailing his time as president as victory and making america great. 

And the same goes for his supporters.

[lannarebirth]

6 hours ago, bristolboy said:

I know what you mean. Like that social credit thing that exists in China and the USA. You know that system whereby if the chinese governemtn decides you are too anti-social, you can't fly or take trains, you can't get loans. I haven't actually seen that in the USA, but since you say that there's little fundamental difference, I guess that system exists there, too.

 

Social Credit system is an insidious, Machiavellian control system. It controls where you can work, if you can borrow, what clubs you might join, where your children go to school, ability to travel and on and on. It is no wonder Trump is being handed his ass in this tariff scheme, because on the one hand we say we want to do business with a country like that and on the other there are no punitive measures. Time to rip the band aid off and change the world order, again. Better to walk our own path than submit to a China led world order.

 

https://www.piie.com/blogs/trade-investment-policy-watch/trump-has-gotten-china-lower-its-tariffs-just-toward-everyone

[bristolboy]

2 minutes ago, lannarebirth said:

 

Social Credit system is an insidious, Machiavellian control system. It controls where you can work, if you can borrow, what clubs you might join, where your children go to school, ability to travel and on and on. It is no wonder Trump is being handed his ass in this tariff scheme, because on the one hand we say we want to do business with a country like that and on the other there are no punitive measures. Time to rip the band aid off and change the world order, again. Better to walk our own path than submit to a China led world order.

 

https://www.piie.com/blogs/trade-investment-policy-watch/trump-has-gotten-china-lower-its-tariffs-just-toward-everyone

And just enjoy the multiyear economic collapse that follows. You should really look up David Ricardo and the Theory of Comparative advantage

And I think China would disagree about no punitive measures being imposed.

Edited July 3, 2019 by bristolboy

[lannarebirth]

15 minutes ago, bristolboy said:

And just enjoy the multiyear economic collapse that follows. You should really look up David Ricardo and the Theory of Comparative advantage

And I think China would disagree about no punitive measures being imposed.

The advantage lies in getting your chief global competitor, both economically and philosophically to outsource its means of production to it's strongest rival. That's pretty dumb. I am not a believer in growth at any cost.

 

"What does it profit a man (or country) to gain the whole world, yet forfeit his soul?"

[bristolboy]

17 minutes ago, lannarebirth said:

The advantage lies in getting your chief global competitor, both economically and philosophically to outsource its means of production to it's strongest rival. That's pretty dumb. I am not a believer in growth at any cost.

 

"What does it profit a man (or country) to gain the whole world, yet forfeit his soul?"

But what you're proposing isn't a matter of reducing or eliminating growth. It's economic catastrophe.

[lannarebirth]

5 minutes ago, bristolboy said:

But what you're proposing isn't a matter of reducing or eliminating growth. It's economic catastrophe.

 

Not really. It's a big ol' world out there.

 

https://www.businessinsider.com/amazon-microsoft-google-plan-to-move-production-away-from-china-2019-7

[Scott]

Troll posts removed.  

[bristolboy]

7 hours ago, lannarebirth said:

 

Not really. It's a big ol' world out there.

 

https://www.businessinsider.com/amazon-microsoft-google-plan-to-move-production-away-from-china-2019-7

And if and when it happens it will be a gradual process. Not the kind of abrupt cutoff you propose. And the fact is that China actually adds very little value to those particular product lines. Mainly in assembly. Not true of the majority of Chinese exports.

[lannarebirth]

11 minutes ago, bristolboy said:

And if and when it happens it will be a gradual process. Not the kind of abrupt cutoff you propose. And the fact is that China actually adds very little value to those particular product lines. Mainly in assembly. Not true of the majority of Chinese exports.

 

Lenin knew something about greed and short sightedness: “The capitalists will sell us the rope with which we will hang them.” Supposedly attributed to him anyway.

[Cryingdick]

All three indexes close today at record highs. Let's give a well earned salute to the type of capitalism that has stood above all other political systems in the world. 

 

Trump plays the markets like a fiddle. 

Edited July 4, 2019 by Cryingdick