The U.S. and China will relaunch trade talks, and President Trump agreed to delay adding new tariffs on $300 billion in Chinese imports. In exchange, Trump said China agreed to increase its purchases of U.S. agricultural products, according to National Public Radio.
Trump made the announcement after meeting with Chinese President Xi Jinping during the G-20 meeting in Japan.
This story originally appeared in Trade Only Today.
Trump said he will not reduce the 25 percent tariffs currently imposed on $250 billion worth of goods imported from China, according to CNBC. Xi’s government retaliated by taxing U.S. exports, while also reducing tariffs on competing products from other countries.
The U.S. could keep in place broad tariffs on Chinese goods for months or perhaps years, prompting global companies to continue shifting the final stages of their supply chains out of China, according to The New York Times.
“As long as the threat is out there, there are risks in depending on these long supply chains,” Jacques deLisle, director of the Center for the Study of Contemporary China at the University of Pennsylvania, told The Times. “Businesses don’t like uncertainty, and this prolongs the uncertainty.”
The tariffs have prompted companies to shift supply chains out of China.