In a bold step in US-China trade relations, President Donald Trump made a huge announcement. Secondly, he has suspended the most harmful tariffs on all small packages sent from mainland China and Hong Kong to the United States. Tariff rollback Both countries have committed to a 90-day halt at least on escalating their respective tit-for-tat tariffs. This ambitious decision is more fully described in the joint announcements issued by each of the two federal governments.
Under the interim deal, new tariffs on small packages worth less than $800 will be cut from 120% to 54%. The US will reduce its tariff from a recent high level of 145% back to 30%. In exchange, China will lower its retaliatory tariffs on US products from 125% back down to 10%. Trump cautioned that the levies are expired, not repealed. If negotiations remain stalled for the next three months, these new levies may hike back up.
Trump emphasized the nature of the discussions, stating, “We’re not looking to hurt China,” while acknowledging the economic distress China is currently experiencing. This perception is very much in line with an attempt to create a more collaborative trade atmosphere across these two economic giants.
The settlement provides for a flat fee of $100 per item. This new fee will remain in effect for the shipments mailed beyond May 2. This $200 booking fee was supposed to go into effect on June 1. It has been canceled as part of the complex and ongoing negotiations.
President Trump has declared his intent to have additional conversations with Chinese President Xi Jinping, potentially later this week. That’s a good sign. That means both leaders are willing to keep talking and work toward solutions for their trade conflicts.
These recent changes represent an important step in the right direction amid continued trade talks between the United States and China. The deal does more than address existing flare-ups. It’s definitely a good start. It lays the groundwork for a more complete resolution in further negotiations.