U.S. And China Halt Trade War With 90-Day Truce

Donald Trump and Xi Jinping meet over tariffs

The United States and China have agreed to a temporary truce on a trade war that has rattled markets and unnerved investors across the world, it was announced Sunday. 

President Donald Trump has reportedly agreed to hold off on plans for the U.S. to raise tariffs Jan. 1 on $200 billion in Chinese goods. In turn, the Chinese agreed to reduce America's trade deficit with China through the purchase of a "not yet agreed upon, but very substantial amount of agricultural, energy, industrial" and other products from the U.S. the White House said. 

The breakthrough between the two countries reportedly came after a dinner of more than two hours Saturday between Trump and Chinese president Xi Jinping at the Group of 20 summit that was held in Buenos Aires. 

Trump touted the deal aboard Air Force One, telling reporters that "It's an incredible deal. If it happens, it goes does as one of the largest deals ever made." 

Trump said: “What I’ll be doing is holding back on tariffs. China will be opening up, China will be getting rid of tariffs. China will be buying massive amounts of products from us.”

China also agreed to label the potent synthetic opioid fentanyl, as a controlled substance. The decision means that "people selling Fentanyl to the United States will be subject to China’s maximum penalty under the law," White House press secretary Sarah Huckabee Sanders said. 

The United States and China have been locked in a trade dispute for months. Trump imposed import taxes on $250 billion worth of Chinese products and 25% on $50 billion worth. The White House had threatened to raise tariffs on the $200 billion worth of goods to 25% if they couldn't get a deal done by the beginning of the year. 

In return, China hit back with tariffs on $110 billion in U.S. goods. 

The two countries now have 90 days to resolve trade issues, including differences over China's policies on tech. If a deal can't be reached by the end of the truce, the higher U.S. tariffs on Chinese goods will be imposed. 

Photo: Getty Images


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