US, China Said Close to Trade Deal That May End US Tariffs

Visitors using consoles at an eSports event in the Mongkok district of Kowloon in Hong Kong on Jan 29 2019

Visitors using consoles at an eSports event in the Mongkok district of Kowloon in Hong Kong on Jan 29 2019

USA and Chinese officials are nearing completion of a trade deal after Beijing offered to lower tariffs on American farm, auto and chemical products in exchange for Washington considering eliminating sanctions against China, according to a report on Sunday.

The U.S. has threatened to place tariffs of 25 percent on $200 billion of Chinese imports if no deal is reached.

The Wall Street Journal in that report Sunday also said that as part of that trade pact, the United States is considering eliminating most if not all of the trade sanctions imposed on Chinese products past year. That's the amount the Trump administration imposed after China retaliated against the US's first salvo of $50 billion in tariffs that kicked off the eight-month trade war.

The report said China had tentatively agreed to lower tariffs or ease restrictions on farm, chemical and auto products, among others.

Plans for a signing ceremony have been complicated by Xi's need to lead China's annual National People's Congress and to make other foreign trips.

The paper quoted analysts as saying that the failure of Trump's recent summit talks with North Korean leader Kim Jong Un in Hanoi could affect the trade talks in one of two opposite ways.

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As a part of the deal there would be a $18 billion purchase of natural-gas from Houston-based Cheniere Energy Inc, the report said.

Also, President Donald Trump said that he wants a dollar that's great for the American economy and not a dollar that is so strong that it is prohibitive for us to deal with other nations.

The US-China trade deal may embolden the Fed to hike rates.

Trump and members of his economic team have has sounded optimistic about the chances for sealing a deal.

Last week, Trump said the USA could walk away from a trade deal with China if it were not good enough, even as his economic advisers touted "fantastic" progress towards an agreement to end the dispute with Beijing.

In a move meant to respond to Trump's repeated demands for a narrowing of America's trade gap with China, Beijing would also increase its purchases of United States goods, including a possible multi-billion-dollar buys of natural gas from the Cheniere Energy group. China bought $130 billion in U.S. goods in 2017, according to USA figures.

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