Xi G20 Meeting to Help Prevent Trade War Escalation - Business Lobby

TRADE WAR: Europe and Asia stock markets higher as China and US agree CEASEFIRE

TRADE WAR: Europe and Asia stock markets higher as China and US agree CEASEFIRE

Forged over grilled sirloin at the Group of 20 summit Saturday in Buenos Aires, Argentina, the ceasefire Trump and Xi agreed to Saturday night illustrated that the leaders of the world's two largest economies can at least find some common ground, however tentative and ill-defined it might be.

In exchange for putting on hold increased tariffs on Chinese imports worth US$250 billion which were penciled in for January 1, Beijing has promised to buy more U.S. agricultural goods and products.

"I'm taking President Xi at his word, at his commitment to President Trump".

But the White House also said the existing 10 percent tariffs on $200 billion worth of Chinese goods would be lifted to 25 percent if no deal was reached within 90 days, once again setting the clock ticking.

In a Tweet on Sunday night, Trump said: "China has agreed to reduce and remove tariffs on cars coming into China from the U.S. now the tariff is 40%". There, all sides agree, the American president agreed to postpone an increase in tariffs on Chinese imports to 25% from 10%, which was scheduled to take effect Jan 1, in exchange for negotiations on broader economic disputes. China responded with tariffs of its own on various USA exports. "It is my great honour to be working with President Xi".

"We don't yet have a specific agreement on that", Kudlow said, apparently contradicting Trump's tweet on the matter.

In return, China is to purchase "very substantial" amount of agricultural, energy, industrial and other product from the US. "Farmers, I LOVE YOU!"

"It's 90 days. It's nothing and it doesn't really make any difference".

Chinese news outlets also claimed both sides plan to eliminate all tariffs, which doesn't appear in the US statement.

In his briefing with reporters, Kudlow said he assumed that the Chinese would eventually drop their auto tariffs altogether.

However, he has faced fierce criticism from USA business groups, as the tariffs lead to reduced exports of crops such as soybeans, while raising costs for businesses that rely on Chinese imports.

The 90-day truce in the escalating trade war between the US and China came during a dinner meeting between the two presidents following the G-20 summit of the world's biggest economies in Buenos Aires.

Hong Kong's Hang Seng index is up 2.8 percent, while futures are pointing to a higher open in North America.

The US and China have been embroiled in a trade war this year which has seen the US hit China with tariffs on $250bn (£195.9bn) worth of goods since July, and China retaliate with duties on some $110bn of US goods over the same period.

Lighthizer is an experienced trade negotiator who just completed a new agreement with Canada and Mexico.

But he tweeted that at "at some time in the future", Xi, Russian President Vladimir Putin of Russia, and he "will start talking about a meaningful halt to what has become a major and uncontrollable Arms Race".

According to the agreement, the USA and China will not increase or introduce new tariffs for 90 days.

"This Statement is not a formal agreement, but the tone and direction seems very constructive for semis", said Stein in a note out on Monday. China imported 280,208 vehicles, or 10 per cent of total imported cars, from the US last year, according to China's Passenger Car Association.

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