Businesses around the world heaved a collective sigh of relief when Presidents Xi and Trump struck a trade dispute truce on the sidelines of the G20 summit. The two Presidents agreed to resume negotiations, although there is no clear path to ending the dispute. The 25% tariffs on Chinese goods imposed by the Trump administration will remain, and the president made clear that they are unlikely to be reduced anytime soon.
President Trump took credit for the temporary timeout, saying he was "very happy" with how things stand. However, businesses and analysts have signaled that China is the clear winner in the race for now. Huawei will now be allowed to purchase U.S. products, a major concession to China. Washington had previously blacklisted the Chinese tech firm due to national security concerns. Beijing, for its part, has agreed to purchase U.S. farm products.
Despite the promising forecast, the trade dispute is unlikely to end anytime soon, with one analyst firm giving it a 45% likelihood of ending by the end of the year. Difficult issues remain to be worked out, including intellectual property theft, espionage, subsidy policies, and more.
Prepared by China-US Focus editorial teams in Hong Kong and New York, this weekly newsletter offers you snap shots of latest trends and developments emerging from China every week, while adding a dose of historical perspective.