Trump is leading USA trade negotiations with China: Mnuchin

Fredrick Soto
December 5, 2018

Trump tweeted on Monday that his meeting with President Xi was "extraordinary", and that "very good things" will happen in terms of the United States' relationship with China.

"We don't yet have a specific agreement on that", Kudlow said, apparently contradicting Trump's tweet on the matter.

That includes more purchases of USA farm products, which Trump - seemingly trying to remind Xi - has said will begin "immediately". If talks fail, the tariff rate on $200 billion of the original $253 billion worth of goods will be hiked from 10 percent to 25 percent.

White House economic adviser Larry Kudlow says there is no "specific agreement" between the United States and China that would address China's tariffs on US auto imports but says he "expects" those duties to go to zero.

That means the death penalty, by the way, but anyhow, here's what China's Foreign Ministry said, again more vaguely: "China has made a decision to list all the fentanyl-like substances as controlled substances and start working to adjust related regulations".

Trump said his team of trade advisers led by China trade hawk U.S. Trade Representative Robert Lighthizer would determine whether a "REAL deal" with Beijing was possible.

But the deal was also vague, and the uncertainty has led to skepticism that the divides between the United States and Chinese goals can be bridged.

Washington and Beijing said they will try to achieve a permanent deal within the next 90 days, however the USA still has significant leverage, stating that if a formal deal can't be reached then it will hike tariffs from 10 percent to 25 percent, which could roil global stock markets, stagnate global economic growth, dampen oil demand growth and possibly lead to a recession across the globe, particularly in emerging economies. When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so.

The White House said Trump and Xi agreed to immediately begin negotiations on structural changes with respect to forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft, services and agriculture. China raised its tariff on auto imports from the USA from 15 percent to 40 percent in retaliation for Trump administration tariffs on imports from China. White House economic advisor Larry Kudlow said the figure was a broad benchmark that would depend on private transactions for U.S. goods and was subject to market conditions.

Markets took a dive following Trump's tweetstorm.

China imposed a retaliatory 25 percent tariff on imports of cars from the USA over the summer in response to Trump's own tariffs.

The U.S. leader said U.S. farmers "will be a very BIG and FAST beneficiary of our deal with China". For months, the two countries have engaged in tit-for-tat increases in tariffs on hundreds of billions of dollars of exports flowing between the two countries.

"The two key events of roughly the last week have been the painkiller dose offered by [Federal Reserve chair Jay Powell] and the soothing market effects of the so-called US-China truce", the Financial Times cited the high-profile analyst as saying.

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