The United States and China have announced Monday that they have reached an agreement to temporarily reduce the import tariffs that had been announced previously. The Escalada in the Commercial War Between both countries I was having a huge impact on the economy, but now both sign a truce that can be the beginning of a new commercial balance.
What happened. In a joint advertisement, both countries have indicated that they reduce their tariffs over the next 90 days, which will continue the negotiations initiated this weekend. As indicated In The New York TimesUnited States will reduce Chinese import tariffs 145% to 30%, while China will apply 10% tariffs to US imports, when that figure It was 125% before this truce.
Source: The New York Times.
“Shared interest”. Scott Besent, US Treasury Secretary, indicated at the press conference in Geneva that both countries have concluded that “we have a shared interest. The consensus by both delegations is that none of the parties wanted a decoupling (commercial).”
China again export rare earths. Another decisions in this agreement is that China will suspend the Rare exports restrictions. This measure had been taken as retaliation Before the ads of the tariffs by the US, but now the North American country will have access to these critical materials for industries such as car, aerospace or semiconductors.
A break for the world economy. This reduction in tariffs is a hopeful pause for a worrying situation. The consequences of tariffs are already being noticed in the industry and of course in the technology prices we buy. There are many companies that have tried to react in the most appropriate way to mitigate the impact of tariffs on their business and customers. The Big Tech Like Apple “With a lot of movement.” surrounding iPhone– They were being clear examples of those impacts, which also noticed Google goal.
More steps back. The truce in the imposition of tariff Like that of semiconductors. It was the first sign that Donald Trump was realizing that these measures were a foot shot for the US.
A Way for the Descale. Both decisions point to a renewed intention for renegotiating the terms of trade agreements between the two major world powers. Mark Williams, Capital Economics analyst, explained that this agreement is “another substantial withdrawal of the aggressive Trump administration position.” The 90 days that will allow both parties to try to reach a new agreement in the application and dimension of tariffs.
Battle won from China? Analysts like Zhiwei Zhang, from Pinpoint Asset Management, explained that “from the perspective of China, the result of this meeting is a success, since China took a determined position in front of the US threat of high tariffs and ended up getting the reduction of tariffs without making significant concessions.”
Uncertainty. Responsible for the European Chamber of Commerce in China indicated feeling “encouraged” for the announcement, although they made it clear that uncertainty persists Because this decision is only temporary. The Hong Kong stock index has grown by 3% after the announcement, and practically the same has happened in the case of the S&P 500 futures index.
Image | Cage Skidmore | Paul Kagame
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