Three-month truce doesn’t signify end of US-China trade war: analyst
Wang Yi, China’s foreign minister, confirmed at a briefing in Buenos Aires right after the highly anticipated Xi-Trump meeting at G20 that presidents of China and the US had reached consensus to stop imposing new tariffs from January 1, as bilateral trade talks continue. Wang noted the two parties had positive and constructive economic and trade discussions at the meeting.

Both China and the US agreed not to slap additional tariffs, and not to escalate the trade war, while indefinitely halting the imposition of new tariffs. Despite that, observers said the agreement merely buys both parties more time and space for further negotiations and it does not mean the end of the trade war. It is believed the two nations would formally resume their trade talks from January.

“Although the trade talks have not started, a positive tone has been set for it. Trump is now willing to sit down for negotiations, instead of waving big sticks to coerce, which indicates the communications between the two nations have been effective,” Shi Yinhong, a professor of Renmin University’s School of International Studies, told In his view, the meeting has brought a thaw to the current trade war, because both parties are concerned escalating the trade war would hurt their economies and bring more uncertainties. However, according to Shi, this does not ensure that the two could reach a pact acceptable to both parties in the future.

Shi believes Trump’s backing down may be related to surging domestic resistance. “The midterm elections mean a total failure for him. With the House of Representatives now in the hands of democrats, the Trump administration’s policies may face the strongest resistance domestically. And as the Russia scandal intensifies and his controversial remarks about Saudi Arabia cause backlash, he now urgently need some new diplomatic success to neutralize the recent adversity.”

Shi predicts the coming trade talks would still be arduous for China, considering the US government would stick to its core demand for China to considerably change its economic mode and industrial policies. Whether the demand would be more stern or resilient will be determined by the three months’ negotiation.

“If some framework agreement could be reached and that one could be sustainable for a while, then there will be the real easing of US-China trade war. But if Trump continues to target China’s core interests, a new round of trade war would occur.”

Diao Daming, vice professor of Renmin University’s School of International Studies, cautioned that the key is whether the US could really fulfill its promises this time. “Over the past few months, there are cases that the US government has gone back on their words, which directly stranded formerly fruitful high-level bilateral trade talks.   

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