China and the United States agreed to a phased reduction of duties on goods

China and the United States agreed to a phased reduction of duties on goods

The White House / Flickr

Donald Trump

The White House / Flickr

China and the United States agreed to a phased reduction of duties on goods, according to the Agency Bloomberg with reference to the representative of the Ministry of Commerce of China Gao Feng.

«If the parties agree on the first part of the transaction, in accordance with the content of the agreement of mutual duties should be synchronous and proportional to the abolition, is an important condition for reaching an agreement,» said Gao Feng, quoted by RIA «Novosti».

Feng also said that the size of tariff reduction in the first phase will depend on the content of this agreement. According to him, the two sides held «constructive talks» in the last two weeks and continue to negotiate where and when will be signed an agreement on the «first phase», according to the portal ProFinance Service.

The first stage takes into account the agreement on the supply of U.S. agricultural products in China, the establishment of rules to prevent the manipulation of exchange rates, measures for the protection of intellectual property and the opening of markets in China for American companies.

The statement led to a rise in the value of U.S. stocks, and also futures for them: the Hong Kong Hang Seng index rose 0.7 percent, while futures on the S&P 500 added 0.5%. This, in turn, resulted in the strengthening of the ruble and the yuan and rising oil prices.

Earlier this month the US and China announced the conclusion of interim trade agreements, in case of signing of which the US is expected, will not impose any new duties against China on December 15. Under the agreement, China will increase the import of American agricultural products at $40-50 billion, it was Assumed that the two leaders will sign an agreement during the APEC summit, which was held in Chile, on 16-17 November, however, Chilean President Sebastian Pinera has refused to accept the summit due to internal problems in the country.

The President of the United States Donald trump August 1 announced that from 1 September, will introduce a new fee at the rate of 10% on goods from China worth 300 billion dollars. As stated by the U.S. leader, the decision was taken due to the fact that China has not fulfilled its promise to increase purchases of American agricultural commodities. In response China temporarily suspended the import of agricultural products from the United States and declared that does not exclude the increase of import duties on these goods. Later it became known that the United States will postpone the introduction of additional duties on some Chinese goods until December 15.

However, the report of the UN Conference on trade and development (UNCTAD), argues that the U.S. imposed additional tariffs on products from China has harmed the economies of both countries. However, the major losers in trade wars have become American consumers that after the introduction of the new tariff must buy goods at higher prices. In the first half of 2019 American duty caused the damage in China $35 billion

It is noted that the imposition of additional tariffs on the import into the U.S. of Chinese products led to a reduction in imports from China by 25%. The vacant place in the us market have used Taiwan, Mexico, the European Union, Vietnam and other countries. However, as pointed out by UNCTAD, in recent years, China started to reduce export prices.

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