China’s first response to the tariffs from U.S. President Donald Trump’s administration will focus on bringing back the “Phase 1” trade deal that was signed in 2020. This information comes from the Wall Street Journal, which cited sources.
China’s plan includes promises not to lower the value of the yuan, to spend more in the U.S., and to cut down on exports of fentanyl ingredients, as reported by the WSJ.
On Saturday, Trump placed a 25% tax on imports from Mexico and most Canadian products, and a 10% tax on goods from China. This was in response to issues related to fentanyl, a dangerous drug, and illegal immigration.
China criticised the tariffs placed on its goods and responded to concerns about fentanyl but is still open to discussions with the U.S. to prevent further conflict. In comparison, Canada, a long-time ally of the US, slapped retaliatory tariffs of 25% on C$155 billion ($105.17 billion) of U.S. goods.
In 2020, Trump signed a Phase 1 trade deal with China that ended a tariff conflict that had lasted almost two years. The agreement asked China to buy $200 billion more in U.S. goods over two years, but China couldn’t meet this goal because of the COVID-19 pandemic.
In January, Reuters claimed that Trump told the USTR to look into how China was doing with that trade deal.
The Journal story mentioned that Beijing intends to handle TikTok mainly as a business issue, allowing investors in the Chinese company ByteDance to negotiate with potential buyers in the U.S.
Trump has said he talked to several people about buying TikTok, including Microsoft, and wants to see a bidding contest for the app.
The U.S. Department of Commerce did not reply to a request for a statement on the WSJ report after normal business hours.
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China’s commerce ministry could not be reached for a comment on the story because of the Lunar New Year holiday.
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