China insists on tariff rollbacks if a trade deal with US is to be reached. Ministry of Commerce spokesman Gao Feng said today that both side are maintaining close communications. But he emphasized “the Chinese side believes that if the two sides reach a phase one deal, tariffs should be lowered accordingly.” For now, he added there is no detail to be released.
The “natural deadline” for phase one US-China trade agreement is just 10 days away on December 15. On the US sides, the message conveyed was clear. If nothing happens between now and then, the scheduled tariffs will take effect. Two core issues are holding up the negotiations for now, China’s agricultural purchases and tariff rollbacks.
It’s believed that Chinese President Xi Jinping is in a tough political position after US passed the Hong Kong Human Rights and Democracy Act and the Uighur Act of 2019. There is tremendous domestic pressure on Xi that he couldn’t sign a trade deal without some concessions from the US for him to claim victory.
