China has extended the olive branch back to the United States by offering a path to eliminate Washington’s burgeoning trade deficit with the country, Bloomberg reported Friday. The news comes less than a day after The Wall Street Journal reported that the Trump administration was considering lifting tariffs amid the ongoing trade war.
Citing sources familiar with the matter, Bloomberg reported Friday that China has offered to significantly boost its purchase of U.S. goods over a six-year period in an effort to re-balance trade between the two superpowers. By increasing its annual imports from the United States, Beijing would reduce its trade surplus to zero by 2024. That would require a spending boost of more than $1 trillion.
Last year, Beijing’s surplus with the U.S. stood at $323 billion.
Trade talks between the U.S. and China are progressing at breakneck speed, a strong sign that both sides are looking to end the tariff dispute before March. That’s when the 90-day truce agreed to by President Donald Trump and China’s Xi Jinping is set to expire.
U.S. officials are reportedly considering lifting tariffs on Chinese imports to give Beijing a bigger incentive to negotiate a fairer trade deal. Last year, the Trump administration announced duties on $200 billion worth of Chinese goods and threatened additional tariffs if Beijing responded. Tensions have simmered down since December when the leaders of both countries met face-to-face on the sidelines of the G20 summit in Buenos Aires, Argentina.
Last week marked the first face-to-face meetings between Chinese and American trade delegates since the G20 summit. The meetings, which went a day longer than planned, resulted in China agreeing to purchase more U.S. farm and agricultural commodities. Chinese officials have also agreed to grant wider access to mainland markets to U.S. firms.
Several risks stand in the way of a comprehensive end to the trade war. Chief among them is the ongoing drama involving Huawei Technologies Corp. U.S. federal prosecutors are following up on civil lawsuits against the tech giant by launching a wider investigation into the company. According to The Wall Street Journal, the investigation has reached an advanced stage and could lead to an indictment shortly.
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Last modified: July 2, 2020 7:29 PM UTC