White House economic advisor Larry Kudlow said that China is expected to reduce its 40-percent tariff on US-made vehicles down to zero, as the two countries enter a 90-day ceasefire in the ongoing trade war in order to negotiate a new trade deal.
The announcement of the 90-day truce, starting from December 1, was accompanied by China’s commitment to begin lifting barriers immediately, Reuters reports.
Kudlow said on a call with reporters that China’s commitment could include the reduction of the country’s 40-percent tariff on US-made vehicles, as well as rolling back their new tariffs on agricultural imports. “We expect those tariffs to fall to zero,” he said about the car-related measures.
“I’ve never heard that ‘immediately’ commitment before,” Kudlow said. “Now, you ask me what that means specifically, all I can say is we’ll see. I presume it will include things like car tariffs and various transactions and agriculture industry, energy and so forth. It could mean licensing, ownership. They are pretty close to some agreements on the IP (intellectual property) theft. And we’re pretty close to agreements on the forced transfer of technology.”
US President Donald Trump and Chinese President Xi Jinping agreed to negotiate a new trade deal in order to end their dispute after months of escalating tensions.
“The history here with China promises is not very good. And we know that,” Kudlow added. “However, I will say this: President Xi has never been this involved.”
“They cannot slow walk this, stall this, meander this. Their word: ‘immediately.’”, the White House advisor added.
Following the news, US administration officials responded with a mix of skepticism and optimism, because none of the commitments were agreed to in writing and many details have yet to be worked out.