China and United States to agree gradual withdrawal of duties

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No one inside the White House would go on the record to confirm the division, and the United States Trade Representative's office has not commented on whether or not there will be tariff rollbacks. In return, China will commit to buy more USA agricultural products.

U.S. trade representative, Robert Lighthizer, is one of several officials who have argued that the duties on the $250bn of goods are a way of making sure China lives up to its commitments and should be in place for the long term.

7, 2019, China's Commerce Ministry says Washington and Beijing have agreed to cancel tariff hikes as their trade negotiations progress.

The agreement came during talks aimed at working out details of a "Phase 1" deal that was announced October 12. Financial markets were rattled by reports China was pushing for tariffs to be lifted, which raised the possibility of a breakdown in talks.

Gao Feng, the ministry's spokesperson, said that both sides agree phasing out the tariffs proportionally is "an important condition for reaching the agreement".

Gao said the two sides are still yet to work out the scope of tariffs that can be rolled back in the first phase.

Chip stocks such as Micron Technology, Advanced Micro Devices and Skyworks Solutions all gained more than 1%.

"Market participants read this statement as a signal that a deal is done", Carl Weinberg, chief global economist with High Frequency Economics, said in a research note.

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.

That weighs on trade and threatens to depress global economic growth that already shows signs of slowing.

The day had started on a weak note following reports that a planned meeting between Trump and Xi to put pen to paper on the deal may be put back to December as they iron out some issues and try to find a place to hold the ceremony.

In terms of the content of the deal, differences still remain on the scale of American farm products China will purchase.

But China is hesitant considering a no-deal summit in Trump's backyard would inflict significant damage on Xi's standing.

China's imports of American soybeans and different items tumbled 26.4% within the first 9 months of this yr following tariff hikes and orders to importers to seek out different suppliers.

Analysts say the phase one deal will fail to adequately address these issues, focusing largely on Chinese purchases of USA farm goods and intellectual property protections related to copyright and trademark issues.

That dampened hopes a face-to-face assembly may produce progress.

"There was a study done by one of the European think tanks that said of the 25 percent [tariff], 20.4 or thereabouts had been absorbed on the Chinese side, either through the deterioration in currency or through prices, and only about 4.5 percent was absorbed on the USA side", Commerce Secretary Wilbur Ross told Gerry Baker during an interview on FOX Business' "WSJ at Large".

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