Relief from the USA and China’s trade agreement - Danske Bank

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The pledge to enhance cooperation with the U.S.to fight illegal drugs including fentanyl and related substances emerged from a highly anticipated dinner between Trump and Xi on Saturday in Buenos Aires that yielded a truce in the trade war between the two countries.

Asian markets rose after the presidents of China and the USA reached a temporary truce in their trade war.

"We didn't really give up anything to China". "The U.S. spent 716 Billion Dollars this year".

Yet reaching a permanent peace will hardly be easy. The Chinese have agreed to increase imports from the USA substantially, including immediately buying more us agricultural products (most likely including soy beans); approve the Qualcomm-NXP deal should the case be presented again, and put Fentanyl as a controlled substance to help us fight on the opioid epidemic.

The 90-day period covers not only Christmas and New Year, but also the Chinese New Year, which comes in February in 2019.

USA exports of cars and light trucks to China were worth US$9.5 billion in 2017 and have dropped off significantly since China imposed its retaliatory tariffs over the summer that gave exporters in Europe and Japan a significant advantage.

Trump withdrew his threat to raise the United States tariffs even more on January 1, in return for a promise from China to buy more U.S. goods and enter into a 90-day period of talks to resolve their differences.

There was no immediate statement from either side when the dinner of more than two hours ended in Buenos Aires.

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The AU statement said the current situation calls for urgent action towards ending the Israeli occupation of the Palestinian land. If adopted, it would be the first resolution condemning Hamas, which has controlled the Gaza Strip since 2007.

Washington and Beijing said they will try to achieve a permanent deal within the next 90 days, however the USA still has significant leverage, stating that if a formal deal can't be reached then it will hike tariffs from 10 percent to 25 percent, which could roil global stock markets, stagnate global economic growth, dampen oil demand growth and possibly lead to a recession across the globe, particularly in emerging economies.

The White House statement said China had agreed to purchase a "very substantial" amount of American products, including "agricultural product from our farmers immediately".

Amid the trade tensions, China has sharply curtailed its purchases of U.S. soybeans and other produce, dealing a significant blow to farmers, a major support base for Trump. That said, China is very likely to increase imports of US products and services to help reduce bilateral trade deficit, reportedly a key ask from the Trump administration. There was no Chinese announcement about possible tariff cuts and the Ministry of Commerce in Beijing didn't immediately respond to questions. For example, the Trump administration's concerns about China's alleged theft of USA intellectual property remain in place and Beijing's broader push for indigenous advances in its hi-tech sector under the aegis of the "Made in China 2025" initiative have yet to be addressed.

But can China be trusted? He said lawmakers can choose between the replacement, the United States-Mexico-Canada Agreement, or nothing.

Initial reaction to the 90-day truce buoyed major Asian markets after the weekend break.

Trump added that if unless China could find a way to tilt the balance of trade power more favourably towards United States businesses, hostilities will resume in January. This would mean that individuals selling the drug to the USA would be subject to China's maximum penalty under the law. On Wall Street, the Dow Jones Industrial Average rose 0.94 percent at the open and the S&P 500 by 1.10 percent. En route from Buenos Aires on Air Force One, the president told reporters that he would soon notify Congress that he's abandoning the North American Free Trade Agreement.

Trump's G20 summit was overshadowed by his abrupt decision to cancel a meeting with Russian President Vladimir Putin. The absence of any such bloc would hurt companies that have built supply chains that crisscross the three countries' borders. In doing so, they cited the trade conflict as well as political uncertainty. Democrats favor provisions of the USMCA that encourage automakers to shift production back to the United States. "It provides direction for China-U.S. relations in the time to come", Wang said.

"The work is not done yet", Democratic Sen. Sherrod Brown wrote to the president this week.

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