China says beginning January 1, it will suspend raising tariffs for 90 days on $126 billion in U.S.-made cars, trucks and auto parts.
The tariff cut lowers the charge for U.S.-made cars and trucks to 15 percent, the same level as imports from other countries.
China imposed the tariffs 8 months ago after warning of an escalating trade dispute with the United States. “We have said many times that China does not want to fight a trade war, But we have also said if we are forced to enter into a trade war, China has the stamina and the confidence to protect its interests,” a top Beijing official warned.
The penalties were imposed in response to Trump’s decision to slap 25 percent tariffs on $50 billion of Chinese goods and a 10 percent charge on another $200 billion. The second tariff was due to rise Jan. 1 until Trump agreed to the postponement, according to the Associated Press.
Following 8 months of “slow growth” President Trump announced earlier today that China ” just suspended U.S. Tariff Hikes,” and that the “U.S. is doing very well.”
He also went on to say “China wants to make a big and very comprehensive deal.”
Reinforcing his commitment to ending the trade war he said “It could happen, and rather soon!”
China just announced that their economy is growing much slower than anticipated because of our Trade War with them. They have just suspended U.S. Tariff Hikes. U.S. is doing very well. China wants to make a big and very comprehensive deal. It could happen, and rather soon!
— Donald J. Trump (@realDonaldTrump) December 14, 2018
Friday’s announcement “shows the Chinese government is willing to solve trade disputes through consultation based on equality,” said Song Lifang, an economist at Renmin University in Beijing.
“If the United States cuts or remove tariffs on Chinese goods, China will surely follow up with further relevant measures,” Song said.
Many economists have claimed that 90 days may not be enough time to resolve conflicts that have plagued U.S.-Chinese relations for years and the consensus is Beijing’s goal may well be be to show it is making progress so Trump will extend his deadline.
What are your thoughts on the the recent concessions made by the Chinese Government? Let us know in the comment section below.