President Trump says that the U.S. and China have come to an agreement to hit pause on the escalating trade war between the two countries.
Trump’s comments follow on from the G-20 summit in Argentina, in which he met with Xi Jinping, president of the People’s Republic of China. The 90-day delay on tariffs will cause a sigh of relief for executives at Apple, since the iPhone was recently threatened with additional tariffs.
Previously, the White House had announced that it would increase tariffs on $200 billion Chinese products to a maximum of 25 percent on January 1. Apple stock unsurprisingly fell after Trump first suggested that this would include Apple products.
During the 90 day delay, the U.S. and China will now try and come to resolutions on various disagreements. These include, “forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft.”
The art of the deal
As part of the deal, Beijing will reportedly agree to purchase a “very substantial” amount of product created by U.S. agriculture, energy, and industry. This would go some way to reducing, “the trade imbalance between our two countries.”
China will also prosecute smugglers of fentanyl, a synthetic opioid 50x more addictive than heroine. China is one of the world’s top producers of the ingredients used to manufacture this drug.
However, while Trump touted the outcome of his talk with Xi Jinping as being “one of the largest deals ever made,” others have been more measured. Mintaro Oba, a former U.S. State Department official, told CNBC that, “it doesn’t matter to [Trump] what the details are as long as he looks strong to his supporters.”
“The results of the discussions in Buenos Aires are positive, but contrary to President Trump’s enthusiastic comments, did not result in a breakthrough,” said David Adelman, former U.S. ambassador to Singapore and adjunct professor at the New York University.