The U.S. and China have tentatively agreed to another truce in their trade war in order to resume talks aimed at resolving the dispute, sources familiar with the situation said.
Details of the agreement are being laid out in press releases in advance of the meeting between Chinese President Xi Jinping and President Donald Trump at the Group of 20 Leaders Summit in Osaka, Japan, this weekend, three sources — one in Beijing and two others in Washington — said.
Such an agreement would avert the next round of tariffs on an additional $300 billion of Chinese imports, which would extend punitive tariffs to virtually all of the country’s shipments to the U.S. The Trump administration has threatened to slap duties of up to 25 percent on the remaining untaxed Chinese goods if this weekend’s talks go poorly.
One source with knowledge of the planning said Trump’s decision to delay additional tariffs was Xi’s price for holding the meeting in Osaka.
“The reality, though, is President Trump could always have a change of heart,” the source said. “But the truce cake seems to have been baked.”
Neither the White House nor the Office of U.S. Trade Representative had any comment on the reports.
Trump reiterated on Wednesday that he was prepared to impose additional tariffs on China if the talks in Osaka fail, but suggested additional duties could start at 10 percent.
A senior Trump administration official told POLITICO earlier this week that it’s possible that tariffs could be delayed but cautioned that “nothing is certain. Absolutely nothing.”
It is unclear whether Trump will put any sort of deadline for the talks to reach an agreement, as he had before. Two sources suggested a deadline of six months, which would put the deadline at the end of the year.
Since the trade war started nearly a year ago, Trump has imposed 25 percent tariffs on $250 billion worth of Chinese goods.
A Washington-based source familiar with the talks said that there were “ongoing attempts to coordinate press messaging,” but added that there was no specificity as of yet regarding decisions on tariffs or timing within that messaging.
The person, speaking on condition of anonymity, said that both sides are expected to release coordinated press releases following the summit, as opposed to one joint statement.
Such a strategy would match the messaging that followed the two presidents’ last sit-down after a G-20 meeting in Buenos Aires, Argentina, in December 2018, which resulted in a three-month pledge to pause further tariff escalation.
The stakes grew even higher this round after Trump promised to subject all Chinese imports to new tariffs.
The language of any statements coming out of Saturday’s parley — whether via a joint communiqué or separate statements — is certain to be subject to the same level of intense inspection.
After the dinner meeting in Buenos Aires, both sides released their own statements, which, while generally consistent, differed on a number of crucial details, prompting immediate scrutiny among analysts seeking to shed light on the closed-door talks.
Missing from Beijing’s readout, for example, was any mention of the 90-day deadline for both sides to reach a deal before higher U.S. tariffs kicked in. And while the White House statement said China had agreed to immediately restart agricultural purchases, there was no such commitment in the Chinese version.