LAUNCESTON, Australia, Dec 17 (Reuters) – As 2020 approaches, the year ends with the tantalising prospect of a trade deal between the United States and China. Again.
Initial agreement to de-escalate the tariff war between the world’s two biggest economies has been interpreted as a positive for the global economic outlook. But it’s worth remembering that 2018 ended on a similar note – leaving the commodities outlook once again hostage to the whims of Donald Trump and Xi Jinping.
In November last year, the U.S. President and his Chinese counterpart also reached a trade agreement of sorts at the G20 summit in Argentina. That was also touted at the time as major progress to ending the tariff war that started in the middle of 2018.
It didn’t take long for the two sides to once again reach an impasse. New tariffs were imposed this year, with the Trump administration ultimately planning to effectively put taxes on all of China’s exports to the United States.
True, last week’s ‘Phase One’ deal stops the latest round of tariffs that were set to come into force on Dec. 15. But it leaves most in place – and the bulk of the hard work to reach a final resolution still to come.