Topline: China is to waive tariffs on some U.S. soybeans and pork imports as the world’s two biggest economies worked on an interim deal to end the 17-month-long trade war.
- China placed tariffs of 25% on the agricultural products in July 2018, in response to the White House’s move to impose tariffs on Chinese goods over the alleged theft of American intellectual property.
- Beijing had promised in September to lift the tariffs that lifted taxes on soybeans imports to 33% from 3% but the new tax exemption only applies to some firms and some imports.
- China’s finance ministry has not shared any further detail on the waiver of the agricultural tariffs.
- Washington and Beijing are currently ironing out an interim “phase one” deal to wind down the trade battle that has rattled markets, and cost Chinese exporters and American farmers billions.
- The waiver was announced just days before a new set of U.S. tariffs on $160 billion of Chinese goods kicks in on December 15.
Key background: China’s tariffs on soybeans, the U.S.’ most valuable farming export, have resulted in U.S. sales to China falling 90% since 2017. As a result, the Trump administration has forked out some $28 billion in aid to American farmers hit by the sales drop. It has also pressed China to raise its imports of soybeans from U.S. as a goodwill gesture in anticipation of a trade deal.
China has moved to…