Will the renewed trade agreement between the U.S. and China potentially alleviate prolonged conflicts?
In the ever-evolving dance of global trade, the US and China continue to tango, with the world's economic heavyweights agreeing on a provisional plan to smoothen the exchange of sensitive goods [1]. This latest détente took place after two intense days of discussions in London, following initial groundwork laid in Geneva last month [1].
The plan, while a step forward, remains tentative. Key details, such as the timeline for the next round of negotiations, are still unclear [1]. Alex Capri, a senior lecturer at the National University of Singapore Business School, underscores the complexity of the negotiations, likening them to a years-long process owing to the multifaceted nature of the trade relations [1].
Capri expresses doubts about the effectiveness of short-term negotiations, suggesting that they may not lead to long-term agreements [1]. Instead, he predicts an increase in "transactionalism" with more one-on-one meetings that are works-in-progress [1].
Observers, however, are cautiously optimistic about the shift in tone between the two global juggernauts [1]. Deborah Elms, a trade and economic policy expert, comments, "It's unclear what has been agreed to besides a sort of pathway to a framework to implement a concept of a plan. So it's early days" [1]. Yet, she acknowledges that both sides seem to understand that escalation isn't in their interest and that discussions are essential for finding a resolution [1].
Here's a brief overview of the key agreements as they stand:
- Tariffs: The U.S. and China have agreed to tariffs of 10% for U.S. goods and a range of 10% to 55% for China-origin goods, although details remain murky [1][2].
- Export Controls and Supply Chains: The framework addresses export restrictions on rare earths and semiconductors. China will issues export licenses for rare earths based on "reasonable needs," and the U.S. will facilitate Chinese student access to American colleges and universities [1].
- Implementation: The agreement is currently at the "handshake for a framework" stage. Final implementation awaits approval from both Trump and Xi Jinping, indicating that some concessions may require direct presidential authorization [1].
[1] https://www.reuters.com/business/us-china-reach-tentative-trade-deal-second-day-talks-uk-2021-06-09/[2] https://www.reuters.com/business/us-china-splash-tariffs-come-next-week-geneva-trade-talks-right-pathway-2021-05-17/
War-and-conflicts could potentially be reshaped if the tentative plan between the US and China leads to long-term agreements, as outlined in the policy-and-legislation of the new trade deal. However, the unfolding dynamics of politics might have a significant impact on the general news landscape as the two global powers continue their negotiations, with the future of trade relations yet to be fully understood.
