China, US to cancel tariffs in phases
Interim deal likely to include US pledge to scrap tariffs scheduled for Dec 15 on about $212 billion worth of Chinese imports
BEIJING China and the United States have agreed to cancel in phases the tariffs imposed during their months-long trade war, the Chinese Commerce Ministry said yesterday, without specifying a timetable.
An interim US-China trade deal is widely expected to include a US pledge to scrap tariffs scheduled for Dec 15 on about US$156 billion (S$212 billion) worth of Chinese imports.
Tariff cancellation was an important condition for any agreement, ministry spokesman Gao Feng said, adding that both must simultaneously cancel some tariffs on each other's goods to reach a "phase one" trade deal.
"The trade war started with tariffs, and should end with the cancellation of tariffs," Mr Gao told a regular news briefing.
The proportion of tariffs cancelled for both sides to reach a "phase one" deal must be the same, but the number to be cancelled can be negotiated, he added, without elaborating.
"In the past two weeks, the lead negotiators from both sides have had serious and constructive discussions on resolving various core concerns appropriately," Mr Gao said.
"Both sides have agreed to cancel additional tariffs in different phases, as both sides make progress in their negotiations."
He did not give a timeline.
In what could be another gesture to boost optimism, China's state news agency Xinhua reported late yesterday that the Chinese customs and the Ministry of Agriculture are considering removing restrictions on US poultry imports.
China had banned all US poultry and eggs since January 2015 due to an avian influenza outbreak.
Beijing's signal that a "phase one" trade deal with the United States was close to being sealed helped Europe's share markets hit a more than 4-year peak yesterday and bond yields shuffled higher.
A source previously told Reuters that Chinese negotiators wanted the United States to drop 15 per cent tariffs on about US$125 billion worth of Chinese goods that took effect on Sept 1.
They also sought relief from earlier 25 per cent tariffs on about US$250 billion of imports, ranging from machinery and semiconductors to furniture.
A person familiar with China's negotiating position said it was pressing Washington to "remove all tariffs as soon as possible".
A deal may be signed this month by US President Donald Trump and Chinese President Xi Jinping at a yet-to-be determined location.
Dozens of venues have been suggested for a meeting, which had originally been set to take place on the sidelines of a now-cancelled mid-November summit of Asia-Pacific leaders in Chile, a senior Trump administration official said on Wednesday.
One possible location is London, where the leaders could meet after a Nato summit that Mr Trump is due to attend from Dec 3 to 4, the official said.
Mr Gao declined to say when and where such a meeting could be.
Since Mr Trump took office, his administration has been pressing China to curb massive subsidies to state-owned firms and end the forced transfer of American technology to Chinese firms as a price of doing business in China. - REUTERS