‘BIG leap forward,’ says Donald Trump on US-China relations

‘BIG leap forward,’ says Donald Trump on US-China relations

Shares of Chinese vehicle dealers also perked up on hopes that such a move could revitalize the domestic auto market that is poised for its first annual sales contraction in decades amid cooling economic growth and a debilitating U.S.

Both sides gained from hitting the pause button, with Trump securing a Chinese pledge to import more USA goods and Xi staving off the further pressure that higher tariffs would place on his country's slowing economy.

As more careful practitioners of the English language would note, "reduce" and "remove" are two different things. China has retaliated with duties on some $110bn of USA goods over the same period.

However, Andrew Hunter, US economist for Capital Economics, said he is optimistic that the apparent "ceasefire" will hold, even though the two sides have been in similar positions before. If Trump wants a win from this battle, he'll need to understand that Xi won't give in easily. Meanwhile, Xi has cultivated an outward-looking posture that aims for cooperation and compromise, embracing the virtues of economic cooperation, free trade and global leadership. Throughout the entire "agreement", about the only quantifiable detail is the promise that America will go ahead and increase tariffs from 10 percent to 25 percent in 90 days if a better deal is not reached.

The US has hit $250b of Chinese goods with tariffs since July, and China has retaliated by imposing duties on $110b of US products.

Trump gave no details about the vehicle tariffs, and there was no immediate response from the Chinese government.

It will still take several months for cargoes to reach China and show up in import figures, but the ship-tracking and port data should show quite quickly if cargoes are being arranged.

It is linked to "intense geopolitical competition" with Washington.

Ultimately, a meaningful, lasting deal is unlikely in the 90-day window.

While Mr Xi agreed to buy an unspecified but "very substantial" amount of agricultural, energy, industrial and other products, the White House said.

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"Given the complexity of interactions between the two economies, the rest of the world will still be holding its collective breath while it waits to see if the series of constructive plans that are in the works can put bilateral relations back on a cooperative rather than confrontational track", it said.

"We will probably end up ending up getting something that will be good for China and the United States", Trump said, while Xi said they shared tremendous responsibility to find a solution.

While the Trump administration emphasized trade issues such as a 90-day moratorium on raising tariffs and Xi's concession to buy "very substantial" amounts of US goods, China focused on diplomacy, regional issues and an agreement to try to quickly resolve their differences. The world, Xi said, has witnessed a lot of changes since then. But they have been overshadowed by the tariff battle.

The government also has promised to ease limits on foreign ownership of automakers, insurance ventures and other companies.

Mr. Trump agreed to hold off on a sharp hike in tariffs on Chinese imports that had been scheduled to take effect January 1.

Later that month, China reduced the tariff rate to 15 percent on all imported vehicles while raising it for US cars to 40 percent.

Carmakers were dealt a blow back in July when they were forced to hike prices after China raised tariffs on United States auto imports to 40 percent.

There was no immediate response on Monday from the Chinese Commerce Ministry about whether Beijing had made such a pledge.

Xi's government complains Chinese companies are treated unfairly in American security reviews of proposed corporate acquisitions, even though almost all deals are approved unchanged.

"What he will be doing to fentanyl could be a game changer for the United States and what fentanyl is doing to our country in terms of killing people", Trump told reporters on aboard Air Force One as he left Argentina following the Group of 20 summit. He is too committed to confronting Beijing over technology "to easily back away from those issues".