UPDATED 1:33 PM PT — Friday, January 17, 2019
A new bombshell report is indicating that President Trump’s aggressive trade strategy on China could result in a historic new agreement. On Friday, Bloomberg reported that China has offered a way to completely slash its trade imbalance with the U.S.
During mid-level talks in Beijing earlier this month, China reportedly said it will go on a six-year buying spree to greatly boost imports from the U.S. The report suggested the move would cut China’s trade surplus to zero by 2024.
President Trump has made cutting the trade deficit with China a chief priority of his trade strategy, repeatedly claiming he wants a fair and reciprocal deal.
Some believe this proposal shows China is close to giving in on what the U.S. wants, and a deal could be happening soon.
“He needs to say — ‘I got this, it’s going to happen, you can trust me on that’ — and if it doesn’t happen, we’ll go back to tariffs, so you can’t just make any deal, but the president does want one and I’ll think we’ll get one in about a month,” said Derek Scissors, resident scholar at the American Enterprise Institute.
The report comes as China’s top negotiator prepares for his trip to the U.S. to meet with Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.
Although the deadline on the 90-day truce is closing in, financial experts say progress is happening at the right speed.
“I think at the end of the day the fact that we’ve got the vice premier coming on the 3oth and 31st is incredibly positive, and I think the fact that the U.S. went there a couple of weeks ago is postie as well — this is moving exactly as you want,” said Paul Richards, president of Medley Global Advisors.
If China does take steps to even out trade, it would widely be seen as the greatest trade related accomplishment during President Trump’s time in office.