- President Donald Trump tweeted on Saturday that an initial trade agreement with China was the “greatest and biggest deal ever,” citing wins for US farmers and billions in Boeing plane sales.
- The US and China reached an agreement Friday in which Trump suspended a new round of tariffs in exchange for trade concessions.
- The initial deal represents significant progress, but a full resolution to the long-running trade dispute between the world’s largest superpowers is still a long ways off.
- Read more stories like this on Business Insider.
President Donald Trump on Saturday took to Twitter to tout victory in an initial trade agreement the US and China reached the day before, calling it the “greatest and biggest deal ever made for our Great Patriot Farmers in the history of our Country.”
But both sides acknowledge a full resolution to the long-running trade dispute between the world’s largest superpowers remains a long ways off.
The two countries reached an accord Friday that will nix a new round of tariffs Trump had planned to unleash on Tuesday in exchange for trade concessions from China.
Precise details were scant, but the agreement reportedly included China’s purchase of as much as $50 billion in US agriculture products — one of the hardest-hit US industries in the trade-war crossfire.
Trump sought to pump air into the accomplishment of the first-phase agreement Saturday, revealing that the deal also includes billions in Boeing plane sales and saying that farmers “really hit pay dirt!”
….Other aspects of the deal are also great – technology, financial services, 16-20 Billion in Boeing Planes etc., but WOW, the Farmers really hit pay dirt! @ChuckGrassley @joniernst @debfisher @BenSasse Thank you to all Republicans in Congress for your invaluable help!
— Donald J. Trump (@realDonaldTrump) October 12, 2019
“The deal I just made with China is, by far, the greatest and biggest deal ever made for our Great Patriot Farmers in the history of our Country. In fact, there is a question as to whether or not this much product can be produced? Our farmers will figure it out. Thank you China!” Trump wrote.
The two sides have held on-again, off-again efforts to mitigate the conflict for months with little to show for it until this point beyond increasingly escalating tariff threats.
It’s a significant step, but the deal could still fall through
The agreement reached Friday marks a significant step toward ending the dispute, though both sides acknowledged a long road ahead to ending the tariff war that has been roiling global markets since March of 2018.
A written pact has yet to be signed and is still weeks away, and the deal could still fall through in the meantime. Trump told reporters he didn’t believe that would happen.
“There was a lot of friction between the United States and China, and now it’s a lovefest. That’s a good thing,” Trump said.
In the Oval Office, Chinese Vice Premier Liu He gave a positive yet more measured review of the agreement.
“We have made substantial progress in many fields. We are happy about it. We’ll continue to make efforts,” Liu said.
The initial “phase-one deal” could be finalized next month, Trump suggested, when he and Chinese President Xi Jinping attend an economic summit in Santiago, Chile.
Still, even as Trump suspended a new round of tariffs planned for October — an increase to 30% from 25% on $250 billion in Chinese imports — tariffs on some $360 billion worth of Chinese goods remain in place.
Trump’s plans to hike tariffs in December on clothing and electronics remain in place.
It’s also unclear whether the two countries are substantively nearer to resolving key points of tension, such as intellectual-property rights and currency manipulation.
If the deal comes to fruition, it would provide a much-needed salve on the wounds of the US agriculture sector, a key Trump constituency that has suffered as China has thrown counter-punches to Trump’s tariffs.
But some experts nonetheless poo-pooed the results of the negotiations and threw cold water on Trump’s claims of a major victory for farmers, saying such relief could’ve been obtained long ago in earlier negotiating rounds.
“If this turns out to be all there is, we could have achieved these results a year ago or more,” Derek Scissors, a trade expert at the American Enterprise Institute who has advised the Trump administration, told The Wall Street Journal.
And despite the progress and Trump’s confidence that a formal pact will be hammered out in November, the reality of the countries’ turbulent relationship suggests the progress could still be scuttled before the next rendezvous in Chile.
“If they couldn’t agree on a text, that must mean they’re not done. Wishing an agreement does not one make. This isn’t a skinny deal. It’s an invisible one,” Scott Kennedy, a China trade expert at the Center for Strategic and International Studies in Washington, told Reuters.