WASHINGTON (AP) – The United States is suspending a tariff hike on $250 billion in Chinese imports that was set to take effect Tuesday, and China agreed to buy $40 billion to $50 billion in U.S. farm products as the world’s two biggest economies reached a cease-fire in their 15-month trade war.
The White House said the two sides made some progress on the thornier issues, including China’s lax protection of foreign intellectual property. But more progress will have to be made on key differences in later negotiations, including U.S. allegations that China forces foreign countries to hand over trade secrets in return for access to the Chinese market.
President Donald Trump announced the trade truce in a White House meeting with the top Chinese negotiator, Vice Premier Liu He. The news followed two days of talks in Washington.
“You’re very tough negotiators,” Trump said to the Chinese delegation.
Trump has yet to change plans to impose tariffs Dec. 15 on an additional $160 billion in Chinese products, a move that would extend the sanctions to just about everything China ships to the United States. The Dec. 15 tariffs would cover a wide range of consumer goods, including clothes, toys and smartphones and would likely be felt by American shoppers.
Still, nervous financial markets welcomed the prospect of reduced tensions between Washington and Beijing.
The two sides are deadlocked primarily over the Trump administration’s assertions that China steals technology and pressures foreign companies to hand over trade secrets as part of a sharp-elbowed drive to become the global leader in robotics, self-driving cars and other advanced technology.
Beijing has been reluctant to make the kind of substantive policy reforms that would satisfy the administration. Doing so would likely require scaling back China’s aspirations for technological supremacy, which it sees as crucial to its prosperity.
Earlier Friday, China announced a timetable for carrying out a promise to allow full foreign ownership of some finance businesses, starting with futures traders on Jan. 1, as Beijing tries to make its slowing economy more competitive and efficient.
Ownership limits will be ended for mutual fund companies on April 1 and for securities firm on Dec. 1, the China Securities Regulatory Commission said. Until now, foreign investors have been limited to owning 51% of such businesses.