As high-level talks between President Donald Trump and senior officials of China progress at the Oval Office in Washington, a senior Trump administration official has brought to the attention of the public an agreement which had been reached on 19th May 2018. As of Friday, Chinese officials have pledged to increase American imports into the country up to 200 billion USD by 2020. This agreement is expected to avert any possibilities of a trade war between America and China.
The Vice Premier of China, Liu He, and Mr. Trump himself have decided that in order to narrow the trade deficit of American commodities in China, the government would reduce most tariff and non-tariff barriers which stand in the way of American imports into the country. At present, China exacts tariffs on many American products including autos and agricultural goods. Other complications like American companies being compelled to partner with Chinese firms to ship goods into the country have also proved to hinder prosperous trade between America and China. After these tariffs are removed, a minimum of 200 billion USD worth of goods are expected to enter China in 2020.
This agreement has proved to be a development in the perspective of the American trade officials. As for the benefit of China, Liu He had presented an offer to the Oval Office on Friday afternoon, intending to persuade America to lower their tariffs on Chinese goods as well. Under the Trump Administration, the United States has exacted multiple trade penalties on Chinese commodities including a minimum tariff of 150 billion USD on all Chinese exports. As of yet, the US has also imposed sanctions on the largest Telecom firms in China, ZTE, which is crippling the Chinese economy thoroughly. Before the negotiations come to an end, both sides are expected to reduce the intensity of their trade barriers so that both America and China can benefit from each other’s economy.