China wants US in first phase to roll back tariffs

China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a “phase one” US-China trade deal, people familiar with the negotiations say.

The deal, which may be signed later in November by Trump and Chinese President Xi Jinping, is widely expected to include a US pledge to scrap tariffs due for December 15 on about $156bn worth of Chinese imports, including cellphones, laptop computers and toys.

A US official said the fate of the December 15 tariffs is being considered as part of negotiations and a potential signing trip in November. Another source briefed on the talks said Chinese negotiators want Washington to drop 15% tariffs on about $125bn worth of Chinese goods that went into effect on September 1. They are also seeking relief from earlier 25% tariffs on about $250bn worth of imports.

A person familiar with China’s negotiating position said it is continuing to press Washington to “remove all tariffs as soon as possible”. China’s request to remove the September 1 duties was earlier reported by Politico, citing sources. The Financial Times also reported that the White House is considering whether to roll back the September 1 tariffs.

Geng Shuang, a spokesperson at the Chinese foreign ministry, said the two sides are in touch. “Trade consultations have made progress and are advancing in accordance to plan.”

On the tariff issue, Geng said he could only give an answer “in principle. Adding tariffs is not the correct way to resolve trade issues,” he said at a regular press briefing in Beijing on Tuesday.

Taoran Notes, an influential WeChat account run by China’s Economic Daily, said the removal of the additional tariffs already imposed by the US is China’s “most core concern”. “Any miscalculation on this issue could well cause further back and forth in the consultations.”

Ralph Winnie, director of the China programme at the Eurasia Centre, said wrapping up the interim trade pact would boost both the US and Chinese economies, while handing Trump an important win among farmers a core constituency.

“It’s in both countries’ interest to have this trade deal,” Winnie said. “If he seals the deal, it will be looked on very favourably by the American people. It’s a winwin for both countries.”

On Tuesday at an import fair aimed at burnishing China’s free-trade credentials, Xi called on countries to stand against protectionism and reiterated vows to open China’s economy and strengthen protection of intellectual property (IP) rights.

Foreign governments and business groups have become sceptical of Chinese reform promises and have long warned that China would invite retaliation if it did not match the openness of its trading partners.

Since Trump took office in 2017, his administration has been pressing China to curb huge subsidies to state-owned firms and end the forced transfer of US technology to Chinese firms as a price of doing business in China.

Analysts say the phase one deal will fail to adequately deal with these issues, focusing largely on Chinese purchases of US farm goods and IP protection related to copyright and trademark issues. It will not address industrial subsidies at all.

China is requesting some changes to the text, but parts of the agreement are “very close to finished”, said a US source briefed on the talks.

IF HE SEALS THE DEAL, IT WILL BE LOOKED ON VERY FAVOURABLY BY THE AMERICAN PEOPLE. IT’S A WIN-WIN FOR BOTH COUNTRIES