Listen to this articleThe U.S President Donald Trump and Xi Jinping have agreed to stop a long-running trade war between the United States and China. The new deal will provide a significant amount of relief to global markets. Both world leaders met for a highly anticipated dinner at the G20 summit in Buenos Aires on Saturday evening, in order to resolve the dispute. Trump agreed to stop plans to raise tariffs on $200 billion worth of Chinese goods. Trump administration had designed to increase tariffs from 10% to 25% from 1 January 2019.
China immediately responded and made some new taxes on the substantial amount of agricultural, energy and industrial goods from the United States. The truce was struck during a 2-hour dinner between both leaders and their advisers. The concessions will buy time for the two sides to work out a deal covering the areas still in dispute. New trade talks on technology transfer, intellectual property, non-tariff barriers, cyber theft, and agriculture will now take place. Both sides agreed the 10% tariffs if no deal is reached within 90 days and it will be raised to 25%.
The trade dispute between both countries escalated in the month of September when Trump imposed 10% tariffs on $200 billion worth Chinese goods. It was only for China to retaliate with duties worth $110 billion on US products. Beijing has also agreed to reconsider a takeover of chipmaker NXP by a U.S company Qualcomm. It had previously blocked the move on antitrust concerns but it is unclear whether the transaction could be revived, even with China’s agreement.
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