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Donald Trump-China trade deal unravels

06 December 2018

On 2 December, Bloomberg published a side-by-side comparison of statements made by USA and Chinese officials and found them "rarely overlapping".

Mr Trump and Mr Xi agreed on a trade war truce on the sidelines of a Group of 20 summit in Argentina last Saturday, holding off on new tariffs and giving negotiators three months to reach an agreement.

US President Donald Trump sowed confusion on Tuesday over the trade-truce with China, as he said negotiations could extend beyond an agreed 90-day timeframe.

But concerns linger over discrepancies in information coming from either side.

"You should talk to him", replied Abe, encouraging Xi to engage in direct conversations with Trump, knowing that he respects the Chinese leader.

He said he would place "major tariffs" on Chinese goods imported into the United States if his administration is unable to reach an effective trade deal with Beijing.

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Skepticism mounted Tuesday about President Trump's impromptu trade agreement with the president of China, as Mr. Trump threatened new penalties against Beijing if the deal falls through.

While Trump hailed the agreement with Xi "an incredible deal", a lack of detail from the Chinese side has left investors and analysts wondering if Trump's exuberance is warranted.

"When people or countries come in to raid the great wealth of our nation, I want them to pay for the privilege of doing so", Trump said in a post on Twitter. He told reporters that China had said it was willing to "expand imports according to the needs of its domestic market and people, including importing marketable products from the USA to gradually ease the trade imbalances", adding that both sides had agreed to open their markets to each other.

Chinese officials are puzzled and irritated by the administration's shaky handling of the meeting's aftermath, according to a former USA government official who has been in contact with them.

Starting during the campaign, Trump has repeatedly said he wants to level out the $375.6 billion trade imbalance with China, and has called for the country to remove barriers like tariffs and protectionist measures like subsidies.

China's ministry of foreign affairs said Monday the Chinese and US president had agreed to work toward removing all tariffs.

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White House economic adviser Larry Kudlow said on Tuesday that a reduction in Chinese tariffs on USA cars and agricultural and energy commodities would be a "litmus test" for whether U.S.

The comments come after seemingly contradictory accounts from Chinese state media and the Trump administration prompted speculation that few concrete concessions had been made.

While he said he would "happily sign" a fair deal that addresses USA concerns, he warned: "remember, I am a Tariff Man". As part of his Twitter storm today, the United States president called himself "Tariff Man" and then proceeded to demonstrate his lack of basic understanding about how tariffs work, seemingly ignorant of the fact that tariffs are in effect a tax paid by domestic consumers, not foreign countries. Ben Sasse, a Nebraska Republican and opponent of Trump's tariff policy, criticized the president's tweets on that basis.

So just days before the high-stakes meeting with Trump, Beijing made a small goodwill gesture to Tokyo by lifting its import ban on rice from the Japanese prefecture of Niigata, one of 10 areas covered by a sweeping food ban in the aftermath of the 2011 Fukushima nuclear disaster. "It will always be the best way to max out our economic power", he said on Tuesday.

Trump agreed he will leave the tariffs on $200 billion worth of Chinese products at 10 percent, and not raise it to 25 percent as he has threatened to do January 1, according to a White House statement.

Officials from the US and a number of other major economies have often criticized China for its slow approach to negotiations and not following through on commitments.

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Donald Trump-China trade deal unravels