The United States and China seem to have found at least one common lever. Gao Feng, a spokesman for the Chinese Trade Ministry, announced yesterday: The two sides have agreed to cancel the duties in stages depending on the development of the agreement. A few words, but with some substance. The most quoted interpretation that Donald Trump and Xi Jinping are now close to signing the so-called phase one of the trade agreement. The negotiators would be specifying the details and the diplomacies would be working to choose a sufficiently scenic venue for the summit between the two leaders. Trump would like a place in the United States, but other hypotheses in Europe are also being studied.
The epicenter of Wall Street optimism. The New York Stock Exchange played a rocket, rising by almost a percentage point. Enjoy it, tweeted Trump. Substantial distances remain on at least one key point: the protection of patents and technological knowledge, assets of US companies in China. However the declarations coming from Beijing are an important signal. So far the Oval Office team, led by Trade Representative Robert Lighthizer, had theorized the punitive, almost re-educational use of duties. Trump's economic adviser, Lawrence Kudlow, had explained it this way, a few weeks ago, to an audience of entrepreneurs gathered at the Embassy of Italy: The president wants a world with zero duties, but we will continue to use them until China does not We will change our attitude and Europeans must help us. On the other side, Beijing has always placed bilateral disarmament of tariffs as a condition for serious treatment.
According to Gao Feng's words, therefore, we are faced with a first compromise. The United States gives up the club; China to pre-emptive cancellation: customs withdrawals will be lifted gradually and simultaneously, as concrete agreements are reached. Also for this reason it is possible to imagine a protocol divided into various chapters, which is often the best way to unravel complex matters.
The Americans have imposed duties on Chinese products for a value of 360 billion dollars, two-thirds of the total import. Beijing has responded with tariffs on goods from 90 billion dollars, equal to 58% of the made in the USA. Already a month ago Trump had revealed a plan to cancel the penalty on goods such as clothing, food, small appliances, worth 100 billion dollars. Then, however, nothing was done and the tensions had increased.
In recent months the White House has had to face a large two-track deployment. There are companies affected by Chinese tariffs, such as i farmer, with their soy and pork; the high tech of Silicon Valley, Boeing, factories with delocalized supply chains, such as toy and shoe factories. On the other hand, there is the large-scale retail trade that has sent consumers the price increase, with peaks of 17%, triggered by American duties.