China says US trade truce extension creates space to advance talks

BEIJING: China said on Monday a two-month extension of a trade truce with the United States would provide room for both sides to evaluate the implementation of their arrangement to resolve economic and trade issues, while considering how to advance on those fronts.

In confirming the extension through to January 10, China’s commerce ministry said it also provides a “relatively stable and predictable policy environment” for cooperation among companies and continued active discussions.

The extension was one of the key takeaways from the second summit this year between President Xi Jinping and US President Donald Trump, hosted in Washington last week.

Among the first steps under a trade council that both sides have agreed to form, is to discuss a reciprocal tariff cut on $30 billion of products, aimed at maintaining stable bilateral economic and trade relations.

That would also create better conditions for the export of related Chinese products to the United States, the ministry said in its statement.

The economic and trade teams from both sides will hold regular talks focusing on potential investment opportunities and barriers, enhancing policy transparency and predictability, and responding to reasonable concerns from enterprises, it said.

A list released by the White House showed China was planning to trim tariffs on a variety of US agricultural products and other categories including medical equipment, raw materials and food items.  

Agriculture and coal

China’s proposed tariff cuts under the $30 billion of goods are dominated by agriculture including corn, wheat, dairy, meat but not soybeans, according to the White House release.

The choice of products looks designed to help China meet what the White House says is a $17-billion commitment to buy agricultural goods.

China has already resumed large-scale buying of US soybeans under a deal struck last year to buy 25 million metric tons annually.

Both countries will set up an agriculture working group under the trade council, which will hold its first meeting before the year ends to discuss two-way market access and regulation for agricultural products, China’s commerce ministry said.

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The presidential summit also yielded an agreement for China to import 10 million metric tons of coal annually from the United States in 2027 and 2028, the White House release showed.

That amount roughly equals 2% of China’s coal imports each year.

Liquefied natural gas and oil were not on the list.

“Importing US coal is not only a beneficial supplement to China’s domestic coal market, but also brings stable economic income and employment to the US coal industry,” the Chinese ministry said.  

AI, financial firms and direct flights

On artificial intelligence, both sides have agreed on a communication channel for incidents and will hold a follow-up dialogue by the end of November.

China will also examine and approve foreign financial services institutions, including those with US capital, to conduct business and open branches in China.

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There will also be continued communication on increasing flights between China and the United States, the ministry statement said.