Daily Management Review

In-Depth Trade Talks With US On Phase One Says China


In-Depth Trade Talks With US On Phase One Says China
The Chinese commerce ministry said on Thursday that in-depth discussions on a "phase one" trade agreement was being held with the United States which also includes the proposal making the rounds of cancellation of the tariffs which Beijing said was an important preconditions for the two largest economies reaching a partial trade deal.
Chinese commerce ministry spokesman Gao Feng told a regular briefing that the importance of a phase one agreement should be fully reflected in the degree of tariff cancellation.
A trade deal with China was "close", US president Donald Trump had said on Tuesday without providing any details. He however also warned that "substantially" high rise in tariffs will be imposed by his administration on China if a deal with Beijing is not reached. Trump was referring to an earlier announcement was that was made by him of imposing tariffs of 15 per cent on about $156 billion of Chinese consumer goods that is slated to be implemented starting December 15, claimed reports quoting  trade experts and a source close to the White House. Video game consoles, computer monitors, Christmas decorations and items given as gifts during the approaching festive season will be the target of the proposed tariff.
If a phase one trade deal was reached, the December 15 tariffs would probably be averted, White House advisers said last week.
Officials from both the US and China had said last week that a deal for a roll back of some of the tariffs had been agreed in principle. However, days later Trump denied of any such agreement which highlighted the volatile nature of the trade war between the two countries that has been ongoing for more than 16 months now.
In the trade war, the primary weapon of Trump against China has been the tariffs on billions of dollars of Chinese goods – all of which have been aimed at bringing China to the negotiating table to force changes in trade and industrial policies followed by Beijing.
A policy of theft and forced a transfer of American intellectual property followed by China is demanded to be changed according to US demands. Further Washington is also demanding that Beijing cut down on the subsidies it gives to its state owned companies as well as opening up more sectors of its economy to US companies. Additionally, US has also demanded that more of US farm products be purchased by China.
According to reports, the two sides were very close to arriving at a trade agreement but which fell away because China decided to back away from the deal. That move by Beijing resulted in Trump raising tariff rates on Chinese imports and starting a series of new rounds of punitive duties.
A US pledge to scrap tariffs scheduled for December 15 is widely expected to be included in an interim deal if it is finished and signed.
But cancellation of other US tariffs put in place since July 2018 is currently being demanded by China.