Trump says US-China ties make ‘BIG leap forward’

Xi Jinping donald trump g20

Donald Trump hails 'amazing and productive' talks, as US agrees to suspend new China tariffs for 90 days

"On standard trade issues, this is where we were weeks ago", Derek Scissors, a China scholar at the American Enterprise Institute and sometimes adviser to the Trump administration, told The Washington Post.

"If at the end of this period of time, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent", a White House statement said after dinner talks between President Donald Trump and his counterpart Xi Jinping on the sidelines of a G20 summit in Buenos Aires.

Trump and Xi, who were in the Argentinian capital over the last two days for a summit of G20 countries, had gone into the meeting in a bid to pull the world's top two economies from the brink of a full-fledged trade war. And it does provide yet another opportunity for some sort of lasting deal.

Although Trump hailed the deal as "incredible", analysts have pointed out that China actually compromised little.

While Washington touted the immediate increase in Chinese purchases of USA agricultural products, Beijing's statement was much more open, with no reference to immediate or agricultural products.

Chinese officials also reacted positively to the talks. "The two heads of state reached consensus to halt the mutual increase of new tariffs".

What Trump and Xi achieved was the gift of additional time - 90 days, at least - to try to resolve the thorny and complicated issues that divide them.

Still, the market could take a positive view of the development.

Brent crude was trading back above $60 a barrel at $62 after a jump of 4%.

There is something of an irony in this.

The U.S. charges a much lower tariff on imported cars, just 2.5 percent on cars made outside of North America.

Xi Jinping
Xi Jinping

China's main market index was up 2.7 per cent, while Tokyo rose 1.0 per cent.

Contrast that with the USA statement, which focused more narrowly on the truce's benefits for its side. No cargoes are now booked to arrive in December, or beyond, according to the data.

Although Trump has hailed his tariffs as bringing "billions of dollars" into the USA economy, experts have pointed out that costs have increased for US consumers and many businesses are suffering as a result.

However, no cargoes are slated for arrival in December or beyond. Those 10 percent tariffs were scheduled to ratchet up to 25 percent on January 1 if the United States and China failed to reach an agreement to at least postpone that move.

The U.S. leader said U.S. farmers "will be a very BIG and FAST beneficiary of our deal with China". The downside for China is that it also needs USA sourced LNG as its insatiable gas demand expands amid Beijing's mandate that gas make up at least 10 percent of its power generation energy mix by 2020, with further earmarks set for 2030.

The US has hit $250b of Chinese goods with tariffs since July, and China has retaliated by imposing duties on $110b of US products. While these have collapsed since May, imports from Brazil have been ramped up to well above 2017 levels.

Since July, the U.S. has imposed tariffs on $250bn (£195.9bn) worth of Chinese goods.

Shares are advancing in Asia following the meeting between Presidents Donald Trump and Xi Jinping.

The United States and China are locked in a dispute over their trade imbalance and Beijing's tech policies. And China's leader will likely expect compromise on complex territorial issues like Taiwan or the South China Sea before the ceasefire will begin to look like a full-fledged peace accord.

Trump framed canceling NAFTA as a way to force legislators' hands.

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