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President Donald Trump says he is unwilling to roll back any of the tariffs his administration has placed on Chinese imports as part of a "phase one" trade deal. Although the framework of a deal has been announced by leaders in both countries—and despite the fact that plans to sign the deal are already being made—Trump's unwillingness to withdraw any tariffs appears to be a major stumbling block toward actually reaching an agreement.
Trump and his top trade advisor have been quick to shoot down speculation that the "phase one" deal could be the beginning of the end of the trade war. That speculation started on Thursday, when a spokesman for the Chinese Commerce Ministry said both countries had agreed to a reduction in tariffs. But Trump told reporters over the weekend that he had not agreed to any such reduction—a statement that effectively signals Trump's desire to control the outcome of the negotiations, regardless of what his own trade negotiators might be crafting.
Peter Navarro, Trump's top trade advisor and an avowed China hawk, slammed what he called "misleading" coverage of the tariff rollback agreement. In an email to multiple media outlets, Navarro said "the story began with a declaration by propagandists within the Chinese government" and that "there was no such agreement," Politico reported.
It is impossible to tell which side is playing the other—or whether both are merely staking out negotiating positions. But the whole incident strongly suggests that a deal to end the trade war is not imminent, and should lower expectations for what will actually be accomplished within the "phase one" agreement that's still being hammered out.
A quick check of the scoreboard: The United States has imposed tariffs on about $500 billion worth of Chinese imports since July 2018, with another round of tariffs scheduled to hit in mid-December. If those go ahead as planned, nearly all imports from China (minus a few specific carve-outs) will be subject to import taxes. China has retaliated with tariffs on about $110 billion of U.S. goods and by shifting their purchasing of agricultural goods towards other producers. Both sides are losing.
What President Trump said is not what the markets expect. But he said "the US hasn't agreed to a rollback of tariffs". It's not a flat denial. What's certain is that if there's no rollback of tariffs, there will be no phase 1deal. https://t.co/fJEKz9hEFi
— Hu Xijin 胡锡进 (@HuXijin_GT) November 8, 2019
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