China made further concessions to the U.S. on international trade on Friday, adding agricultural products like soybeans and pork to the list of imports exempted tariffs, as prospects for at least an interim deal to resolve the two year old trade dispute improve.
The move by China follows reports on Thursday about the prospects for at least an interim deal to resolve the trade war that could involve the US delaying or reducing some tariffs on imports from China in exchange for Chinese commitments on protecting U.S. intellectual property rights and agricultural purchases.
President Trump said Thursday that he would prefer to get a whole deal done, but US could consider an interim agreement.
With the trade war disrupting supply lines and pushing up costs, manufacturing activity globally has been slowing, dragging down world economic growth and Trump is keen to avoid a recession ahead of next year’s U.S. elections. U.S. economic growth has slowed in 2019 partly because of the trade war with China and its depressing effects on the rest of the world. Exporters such as farmers and large manufacturers have been especially hard hit, leading to weaker business investment and production.
On Friday Chinese state media said it will exempt some American soybeans, pork and other agricultural products from additional tariffs, in the latest move by Beijing to ease trade tensions with the United States.
China Central Television, the nation’s official broadcaster, and other official outlets reported the move without disclosing details about the tariff exemptions, but in a brief report CCTV cited President Trump’s move on Thursday to delay Washington’s new tariffs by two weeks so that they would take effect after trade talks scheduled for early October.
“China supports relevant enterprises buying certain amounts of soybeans, pork and other agricultural products from today in accordance with market principles and WTO rules,” Xinhua said, adding that the Customs Tariff Commission of China’s State Council would exclude additional tariffs on those items.
An outbreak of deadly African swine fever, which has cut China’s pig herd by a third since mid-2018, has propelled Chinese pork prices to record levels and left the country in need of replacement supplies from overseas.
The Chinese Commerce Ministry’s announcement on Friday follows a move earlier this week to exempt a range of American goods from 25% extra tariffs put in place last year, as the government seeks to lessen the impact from the trade war.
The United States and China have both made conciliatory gestures, with China renewing purchases of U.S. farm goods and U.S. President Donald Trump delaying a tariff increase on certain Chinese goods.
China had imposed additional tariffs of 25% on U.S. agricultural products including soybeans and pork in July 2018. It raised tariffs on soybeans by a further 5% and on pork by a further 10% on Sept. 1.
Earlier reports on Thursday suggested Trump administration officials have discussed offering a limited trade agreement to China that would delay and even roll back some U.S. tariffs for the first time in exchange for Chinese commitments on intellectual property and agricultural purchases, according to five people familiar with the matter.
“A lot of people are talking about, and I see a lot of analysts are saying: an interim deal, meaning we’ll do pieces of it, the easy ones first,” Trump said late Wednesday. “But there’s no easy or hard. There’s a deal or there’s not a deal. But it’s something we would consider.”
Some of President Donald Trump’s top trade advisers in recent days have discussed the plan in preparation for two rounds of face-to-face negotiations with Chinese officials in Washington, due to take place in coming weeks, the people said.
Read: U.S. wants to make progress in solving China trade dispute: Mnuchin
However a full trade deal between the two sides is not imminent, analysts said, but after weeks of escalating tariffs both countries appeared eager this week to try to calm tensions before a new round of talks next month.
The better headlines on the U.S. – China trade dispute , along with moves by world central bank to lower interest rates has helped to push up U.S. stocks this week back to near record highs.
On Thursday, the Dow DJIA, +0.17% rose 45.41 points, or 0.2%, to close at 27,182.45, notching a seventh advance and the longest series of gains for the blue-chip index since an eight-session rally ended May 14, 2018, according to FactSet data. Meanwhile, the S&P 500 index SPX, +0.29% added 8.64 points, or 0.3%, to finish at 3,009.57, while the Nasdaq Composite Index COMP, +0.30% advanced 24.79 points, or 0.3%, to end at 8,194.47.
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