Deal reached, Trump holds off tariff plans

US President Donald Trump on Friday outlined the first phase of a deal to end a trade war with China and suspended a threatened tariff hike.

The emerging deal, covering agriculture, currency and some aspects of intellectual property protections, would represent the biggest step by the two countries in 15 months to end a tariff tit-for-tat that has whipsawed financial markets and slowed global growth.

“I think we have a fundamental understanding on the key issues. We’ve gone through a significant amount of paper, but there is more work to do,” US Treasury Secretary Steven Mnuchin said as the two sides gathered with Trump at the White House.

With Chinese Vice Premier Liu He sitting across a desk from him in the Oval Office after two days of talks between negotiators, the president told reporters that the two sides were very close to ending their trade dispute. “There was a lot of friction between the United States and China, and now it’s a lovefest. That’s a good thing,” he said.

“We have made substantial progress in many fields. We are happy about it. We’ll continue to make efforts,” Liu said.

In an editorial published by the People’s Daily newspaper on Saturday, China called the latest round of talks constructive, frank and efficient and noted that while the two sides were moving toward a resolution, “it is impossible to resolve the problem by putting arbitrary pressure on the Chinese side.”

Mnuchin said the president had agreed not to proceed with a hike in tariffs to 30 percent from 25 percent on about US$250 billion in Chinese goods that was supposed to have gone into effect tomorrow.

“I think that we’re going to have a deal that’s a great deal that’s beyond tariffs,” Trump said.

The world’s two largest economies have made progress in their trade dispute before without sealing a deal.

China’s securities regulator on Friday unveiled a firm timetable for scrapping foreign ownership limits in futures, securities and mutual fund companies for the first time.

On Thursday, the US Department of Agriculture confirmed net sales of 142,172 tons of US pork to China in the week ended October 3, the largest weekly sale to the world’s top pork market on record.

The president said China had agreed to make purchases of US$40 billion to US$50 billion in US agricultural goods. Mnuchin said the purchases would be scaled up to that amount annually.

Trump said talks over a second phase would begin as soon as the first phase agreement was signed and said a third phase might be necessary, too.

(Reuters)