'It's possible, it's possible': Trump hints at new trade deal with China

Trump signed a trade deal with China in January 2020. Under this agreement, China promised to protect US trade secrets, buy $200 billion worth of US products, and lower some trade barriers

Amid ongoing trade war with China, US President Donald Trump has said a fresh trade deal with China is ‘possible’, suggesting he may be open to easing tensions between Washington and Beijing, according to a report by Bloomberg.

 

When asked if he would negotiate a new agreement with China, he told reporters on Wednesday, “It’s possible, it’s possible.” However, he did not give details about what such a deal would include.

 

Despite ongoing trade disputes, Trump praised Chinese President Xi Jinping. “There’s a little bit of competitiveness, but the relationship I have with President Xi is, I would say, a great one,” he said.

 

 

Trump had previously signed a trade deal with China in January 2020. Under this agreement, China promised to protect US trade secrets, buy $200 billion worth of US products, and lower some trade barriers. But soon after, the Covid-19 pandemic disrupted relations, and Trump blamed China for it.

 

“They had about $50 billion worth of our product, and we were making them buy it. The problem is that Biden didn’t push them to adhere to it,” Trump said. 

Market reaction to Trump’s remarks

 

According to the media report, Trump’s comments, made during Asian trading hours, caused a slight rise in the Chinese yuan. The offshore yuan gained 0.2 per cent, while the onshore yuan rose 0.1 per cent. Chinese stocks also recovered some losses.

 

“Markets are still getting used to the barrage of social media posts, comments to reporters, and interviews that President Trump is giving,” said Khoon Goh, head of Asia research at ANZ Banking Group. “This is so different from the previous administration,” he said.

 

History of US-China trade war

 

One of the two major economies of the world, the US and China, were in a longtime trade war against each other. This was started in 2018 when the US put extra tariffs on Chinese products. The US justified its action by alleging that China was not trading fairly. Furthermore, the US accused China of stealing ideas and intellectual property that ultimately led US companies to share their technology. 

 

However, in retaliation to US’ actions against it, China imposed its own tariffs on US products like soybeans and cars. This was further continued and over the next few years, both countries kept adding more tariffs, and the US even banned Chinese tech company Huawei from using US technology. 

 

On a good note, in 2020, they signed a ‘Phase One’ deal, where China promised to buy more US goods and protect American businesses, but many tariffs remained. When Joe Biden became US President in 2021, he did not remove most tariffs but focused more on stopping China from getting advanced technology, like computer chips.