US President Donald Trump said early this morning that China has agreed to lift its tariffs on US cars.
Trump tweeted: https://twitter.com/realDonaldTrump/status/1069441198157455360
Trump said current Chinese tariffs on US cars were 40 per cent, but he did not say how much he expected them to fall.
There has been no confirmation from China at this stage.
The announcement comes a day after the two economic superpowers said they were suspending their growing trade war.
Yesterday the White House announced it would pause it plans to raise tariffs on $200bn (£156bn) worth of goods from China.
They had been scheduled to rise to 25 per cent from 1 January but will now remain at 10 per cent.
The news came at the end of this year’s G20 summit in Argentina, after President Trump sat down for a working dinner with President Xi Jinping of China and their trade delegations in Buenos Aires.
In response to the freeze China has pledged to buy farm, energy and industrial goods, to reduce the country’s trade surplus with the US. The exact amount was “not yet agreed upon, but very substantial”, according to the White House.
Further negotiations about the most contentious aspects of Chinese trade policy were also announced. These include compulsory technology transfers, intellectual property theft, and non-tariff barriers.
If no agreement is reached within three months, the planned tariff increases will go ahead, the White House said. Wang Shouwen, China’s vice minister of commerce, said both sides will step up negotiations on eliminating the 10 per cent tariff, according to Chinese state media outlet China Daily.
President Trump heralded the meeting as “amazing and productive", saying it brought about "unlimited possibilities for both the United States and China”.
The promise of a tough stance on China was central to Mr Trump’s election pitch. America’s trade deficit with China was $376bn in 2017, according to the US Census Bureau, which Trump argues hands too much power to China.
His tariff campaign against the country began in January 2018, and saw a 25 per cent tariff on steel imports imposed in March.
Michael Hewson, chief market analyst at CMC Markets UK, said it was “the best we could hope for”, and called it “the status quo maintained”. Referencing Trump’s fiery rhetoric, he said, “it’s all about actions as opposed to words … as long as there’s no escalations, markets will generally look past the words”.