Market News & Headlines >> Uncertainty About Partial U.S.-China Trade Deal
Uncertainty still surrounds Friday’s announced “phase one” U.S. trade deal with China amid a lack of details about the agreement and a report China wants further negotiations before it will agree to sign the deal.
Bloomberg reported Monday that China wants further talks as soon as late October to hammer out the details of the "phase one" trade deal touted by President Trump before China's President Xi Jinping agrees to sign it, according to people familiar with the matter. One person said China wants Trump to also scrap a planned tariff hike in December in addition to the hike scheduled for this week, something the administration hasn't yet endorsed.
Details of the verbal agreement between the two nations that was announced on Friday remain unclear. While Trump hailed an increase in agricultural purchases as "the greatest and biggest deal ever made for our Great Patriot Farmers in the history of our Country," China's state-run media only said the two sides "agreed to make joint efforts toward eventually reaching an agreement," the Bloomberg report noted.
Xinhua, China’s official news service said on Monday that China and the U.S. had achieved “substantial progress” in last week’s trade talks in Washington, which raises “cautious optimism for an eventual deal”.
U.S. Treasury Secretary Steven Mnuchin, in an interview on CNBC said that the "phase one" trade agreement was "substantially done" and said "our expectation is that this will be concluded and signed by Chile", adding "we'll do what we need to do to get this concluded". Mnuchin was referring to the Asian-Pacific Economic Cooperation forum in Santiago, Chile.
In announcing the deal on Friday, President Trump touted that it would involve $40-$50 billion in Chinese purchases of U.S. agricultural goods. “To show you how big that is, that would be two and a half, three times what China had purchased at its highest point thus far. So, they were purchasing $16 or $17 billion at the highest point, and that’ll be brought up to $40 billion to $50 billion. So, I’d suggest the farmers have to go and immediately buy more land and get bigger tractors. They’ll be available at John Deere and a lot of other great distributors,” Trump said.
U.S. exports of agricultural products to China actually peaked at $25.86 billion in 2012, before slipping to $9.15 billion in 2018 amid the U.S.-China tariff war, according to statistics from USDA’s Foreign Agriculture Service.