President Donald Trump on Friday announced his administration has reached a “substantial” trade pact with China that includes some backing off of tariffs, but he signaled work remains to finalize the elusive pact.
The Trump administration has agreed to keep existing tariffs on billions of dollars in Chinese-made goods at current levels rather than raising them to 30 percent, as Trump had threatened to when talks previously stalled.
That’s according to Treasury Secretary Steven Mnuchin, who also was in the Oval Office as Trump spoke.
Trump, at an Oval Office meeting with China’s vice premier, Liu He, called it a “substantial phase one deal,” according to a pool report. Trump campaigned in 2016 on inking a new trade with Beijing that would prevent China from, in his words, continuing to “rip off” the United States, its companies, its consumers and its workers.
Trump has long said he would not sign an incremental deal that did not meet a long list of demands. It was not immediately clear how far the pact he described Friday satisfies his years-long desire for a sweeping agreement.
It could take up to three weeks to put into writing the text of the possible agreement. That means any second thoughts or doubts from either side could still sink the deal. “I don’t think it should be a problem getting it papered,” Trump said. But as he left the White House later for a political rally in Louisiana, he said it might take as long as “five weeks.”
Senate Finance Chairman Charles E. Grassley, whose committee has primary responsibility for trade issues, said farmers in his state of Iowa would welcome the initial announcement. However, Grassley, R-Iowa, said he needs more details.
“Farmers in Iowa know far too well that the trade war has caused real financial pain in the heartland. But we need to know more about this deal and follow-through from China will be key,” he said in a statement.
“A final deal must address the full scope of structural issues identified in USTR’s Section 301 report and include strong enforcement mechanisms,” Grassley said. “After so much has been sacrificed, Americans will settle for nothing less than a full, enforceable and fair deal with China. I look forward to learning more details in the coming days.”
Section 301 is the provision in 1974 trade law that gives the president authority to take action against countries deemed to be using unfair trade practices.
“We have an agreement on intellectual property,” Trump said, referring to a sore point among U.S. business executives that Chinese companies’ demand American firms to turn over closely held information about their products in return for access to the massive Chinese market. He also said the agreement would be good for the U.S. technology and banking sectors, but didn’t say why.
“It’s such a big deal that doing it in sections” makes more sense, Trump said, signaling there could be two more “phases” of the pact.
Administration officials have long said the pact they have been working on with Beijing would not have to be approved by Congress.
Trump said Chinese officials agreed to purchase $40 billion to $50 billion in U.S. farm products. Beijing has promised to do that before, however, with administration officials afterwards expressing frustration that China failed to follow through.
“Oh, they’ll keep their word,” he said, adding that the Chinese agriculture purchases will span two years. Trump said farmers in Iowa and Nebraska will have to buy “more tractors” and land quickly because of his partial China trade accord because “they won’t be able to keep up with the order.”
Ellyn Ferguson contributed to this report.