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Possible trade deal between China and the US

After speaking with Chinese president Xi Jinping on Thursday, US President Donald Trump has signalled the possibility of resolving the trade dispute between the US and China, as reported by Bloomberg.

Signs of a possible deal between the two countries come after almost a year of a trade war between the countries which has resulted in ever-increasing tariffs on various products from both countries. It started in January when Trump decided to put up to 30 per cent import tariffs on solar panels, something China is the leader in manufacturing, to be reduced to 15 per cent within four years, along with a 20 per cent tariff on washing machines. Along with this on May 29 came a 25 per cent tariff on steel and a 10 per cent tariff on aluminium that are imported from Mexico, Canada and the European Union. 

China responded to this on April 2 by putting tariffs on 128 different US products ranging from a 25 per cent tariff on pork and aluminium, plus a 15 per cent tariff on various fruit and nut products. Trump announced soon after with a 25 per cent tariff on 1,300 imported products from China like medical devices and batteries.

Following this, on May 29 the White House announced a plan to implement a 25 per cent tariff on $50 billion worth of goods from China and that it would start with $34 billion worth of tariffs on July 6, which it did. China retaliated by imposing their own 25 per cent tariff on 545 US products that also totalled $34 billion. 

On August 23, the other $16 billion worth of products received a 25 per cent tariff from the US and China responded with more tariffs for the same price of goods. 

The most recent batch of tariffs from the two countries came when Trump said the US would impose a 10 per cent tariff on $200 billion worth of Chinese goods and China responded with tariffs on $60 billion worth of US products. 

During the course of the 2016 presidential campaign, Trump had expressed many times a desire for the US to hold China accountable for various trade practices he saw as unfair to the US. It seems that with all of these tariffs, Trump is hoping to force China to come to the negotiating table and strike a deal that will be in his eyes, favourable to the US. 

 

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