Donald Trump Demands 'REAL DEAL' with China Despite Shaken Stock Market

Darnell Taylor
December 7, 2018

White House economic adviser Larry Kudlow said earlier this week the USA won Chinese commitments to buy more than $1 trillion in American products. If the two had failed to reach an agreement, the US would've seen $200 billion worth of Chinese goods have their tariffs increase from 10% to 25% at the beginning of 2019. US markets were closed on Wednesday to observe former President George H.W. Bush's death, but the effect of Wall Street's turmoil the previous day was felt in Europe and Asia with the benchmark Shanghai stock index closing down 0.6 percent.

The commerce ministry of China assure the agreement signed between Chinese President Xi Jinping and US President Donald Trump at G20 summit had been "successful" and thus China was "confident" about the new implementation on their agreements.

Another significant take-away from the preliminary agreement could be its impact on energy markets, both US oil import to China and perhaps even more importantly from a development perspective liquefied natural gas (LNG) imports.

While it remains to be seen if Washington and Beijing can iron out their trade differences, it would be beneficial for both sides' energy sectors to at least reach some sort of deal that would allow the free trade of energy between the two super powers.

For months, the two countries have engaged in tit-for-tat increases in tariffs on hundreds of billions of dollars of exports flowing between the two countries.

Those 10 percent tariffs were scheduled to ratchet up to 25 percent on January 1 if the USA and China failed to reach an agreement to at least postpone that move.

President Donald Trump on Wednesday scrambled to reverse a stock market plunge over fears his China trade deal won't happen, arguing Beijing was sending "very strong signals" and that he believed President Xi Jingping's promises.

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The U.S. had a $335.4 billion trade deficit with China in 2017.

In a brief statement, the ministry said China would try to work quickly to implement specific items already agreed upon, as both sides "actively promote the work of negotiations within 90 days in accordance with a clear timetable and road map".

"Relations with China have taken a BIG leap forward!"

Trump, via Twitter, threatened to place "major tariffs" on Chinese goods imported into the United States if his administration is unable to reach an effective trade deal with Beijing.

A Chinese official told Reuters that officials were "waiting for the leaders to return" before publicizing details.

President Xi and his most senior officials are due back in China on Thursday, having visited Panama and Portugal since leaving Argentina.

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