China Makes Trade Concessions After Softer Trade Report
While China and the United States are still in the beginning stages of negotiations on a trade deal, there was positive movement last week after the monthly trade report for China revealed declining exports.
Early in the week the Chinese government announced that it will cut tariffs on U.S. imports of automobiles to 15 percent from 40 percent for three months, beginning Jan. 1. The Wall Street Journal also reported last week that the Chinese government will replace its Made in China 2025 industrial policy with one that allows greater access for foreign companies. Unnamed officials from the United States responded with some news of their own.
Even though on Thursday, President Donald Trump threatened to impose tariffs on the remaining $267 billion worth of Chinese imports if the two countries don’t reach a trade deal, news surfaced over the week that the White House definitely will delay its plans to increase tariffs on $200 billion of Chinese goods to 25 percent from 10 percent until at least March 1.
The back and forth came after the Chinese government announced last week that exports fell 5.4 percent between November 2017 and November 2018 to $227.4 billion while imports increased three percent to $182.7. Both numbers were down from October. The Associated Press said the news adds “to pressure on Beijing ahead of trade talks with Washington.” Exports to the United States rose, however, by 12.9 percent to $46.2 billion. Imports from the United States rose only five percent year-over-year.
The U.S.-China trade surplus widened to a record $35.5 billion. China’s exports to the European Union rose 11.4 percent while imports increased 13.2 percent.