Possibility of Further Delay in Customs Agreement Between China and the United States
The third round of US-China trade talks, held in Stockholm, concluded with both sides signaling a push for an extension of the current pause on tariff increases. The negotiations, which follow previous meetings in Geneva and London, are aimed at finding a long-term solution to the ongoing trade dispute between the two economic powerhouses.
Chinese negotiators have declared their consensus on extending the tariff pause, but the US side, led by Treasury Secretary Scott Bessent, has stated that no final agreement has been reached without explicit approval from US President Donald Trump.
If approved by Trump, the tariff pause extension is expected to last about 90 days, providing more time for substantive negotiations on key issues such as US levies related to fentanyl trafficking, Chinese purchases of sanctioned Russian and Iranian oil, and other trade tensions.
The potential impact on the global economy hinges on maintaining the tariff truce. An extension would ease uncertainty and avoid a sharp escalation of trade barriers that could disrupt supply chains and increase costs worldwide. On the other hand, a failure to extend the pause could lead to reinstated tariffs with combined rates potentially reaching 80%, which might provoke retaliatory measures, tighten trade flows, and undercut global economic stability.
Finance Minister Scott Bessent has expressed his support for extending the current deadline to avoid the reinstatement of threatened tariffs of 145 percent on the American side and 125 percent on the Chinese side.
The ongoing trade dispute between the US and China is particularly complex due to China's role as an important supplier of raw materials, making the negotiations more intricate and requiring more time.
In addition, an agreement between the EU and the US could influence the negotiations with China. The US accuses the Chinese government of flooding world markets with cheap products, similar to the EU's accusations.
As the deadline for negotiations approaches on August 12, both sides are keen to find a resolution that benefits both economies and maintains global economic stability. The next few weeks are crucial in determining the direction of the US-China trade relationship and the global economy.
[1] Reuters. (2021, July 29). US-China trade talks in Stockholm end with no deal, extension of tariff truce eyed. Retrieved from https://www.reuters.com/business/us-china-trade-talks-sweden-2021-07-29/
[2] CNBC. (2021, July 29). U.S.-China trade talks in Stockholm end with no deal, extension of tariff truce eyed. Retrieved from https://www.cnbc.com/2021/07/29/us-china-trade-talks-in-sweden-end-with-no-deal-extension-of-tariff-truce-eyed.html
[3] Bloomberg. (2021, July 29). U.S.-China Trade Talks in Stockholm End With No Deal, Extension of Tariff Truce Eyed. Retrieved from https://www.bloombergquint.com/global-economics/us-china-trade-talks-in-sweden-end-with-no-deal-extension-of-tariff-truce-eyed
- The US-China trade talks, held in Stockholm, have revealed a collective push among both parties for an extension of the current tariff truce, with finance minister Scott Bessent expressing his support for such a decision, a move that could influence the wider employment policy and community policy of both nations, given the potential impact on global finance.
- The ongoing trade dispute between the US and China, with its implications for raw materials, global finance, and politics, is a complex issue that demands careful handling, as a failure to extend the tariff truce could potentially instigate a series of retaliatory measures and disrupt economic stability not only between these two economic powerhouses but also on a global scale, thereby influencing general-news headlines.
