After another set of tariffs on $300 billion worth of Chinese goods went into action on September 1, continuing the trade talks between the two countries is highly necessary. Immediately after, the prices of clothing, shoes and other necessities went up in the US. The trade war is affecting both countries’ economies, as well as their respective currencies.
The US President Donald Trump states his principle towards the issue firmly and unequivocally – tariffs will remain for the time being. In case there is no progress in reaching a deal in the following months, escalation is expected in December with another set on the Chinese import. Furthermore, Trump warns that he would go even tougher on Beijing if the trade talks are dragged on.
As for now, Washington and Beijing agreed to hold high-level trade talks in early October. The US capital will be the center of the negotiation while the risk of a recession in the US is hanging over their heads. The urgency of the matter will require ministerial-level trade talks first, also held in Washington mid-September. China’s Vice Premier Liu He and US Trade Representative Robert Lighthizer with the US Treasury Secretary Steven Mnuchin agreed that the time has come to gather and take action in providing the best possible conditions for both countries regarding trade talks.
As a response to September 1 tariffs, China imposed new duties on US crude oil. The situation is not looking well for the US, especially considering the devastation that hurricane Dorian brought around the same time. The prices of oil soared while Dorian affected production in the Gulf of Mexico. In addition, China filed a complaint against the US at the World Trade Organization.
Along with the upcoming trade talks, the US announced it will increase the tariff rate from 25% to 30% on $250 billion worth of Chinese goods which were already affected by October 1. This will only add to the tension if the two countries gather to continue trade talks around the same time.
As for China, the country will have a busy schedule next month, starting with the National Day celebrations on October 1. The country’s officials are also planning to hold a meeting of their own to discuss improving governance and the political system, over a year after the last meeting of the sort was held.