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Thomas Gallatin / October 14, 2019

U.S. and China Push Pause on Trade War

Beijing agrees to purchase U.S. agricultural products; Trump suspends new tariffs.

President Donald Trump announced Friday that the U.S. and China had agreed to a partial trade deal, which Trump referred to as “phase one” of ongoing negotiations. One of Trump’s biggest presidential efforts has been to level the trade playing field with China, and a deal is in the interests of both the president and the entire country.

National Review reports, “The provisions include China purchasing $40 billion to $50 billion worth of American agricultural products, along with agreeing to guidelines on how it manages its currency, and policies with intellectual property, including forced technology transfer.” On America’s part, Trump has agreed to suspend the implementation of another round of tariffs on $250 billion of Chinese goods that had been scheduled to go into effect on Oct. 15. Trump heralded the deal as “very substantial” while at the same time noting that this was merely the first step in negotiating a broader and more comprehensive deal.

News of the deal sent the markets climbing — the Dow closed nearly 320 points higher Friday. The deal is likely to temporarily settle economic concerns, especially with the possibility of a more comprehensive agreement coming as soon as December. However, this long-running trade war is far from over, as China has yet to agree to make any substantive changes to its abusive trade practices.


Update: Bloomberg reports Monday, “China wants to hold more talks this month to hammer out the details of the ‘phase one’ trade deal touted by Donald Trump before Xi Jinping agrees to sign it.” So stay tuned.

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