ExclusiveTrade war: US and China agree to tentative truce before G20 summit

Fresh tariffs expected to be delayed, with two sides preparing separate statements

Source says Donald Trump’s decision to delay additional tariffs was Xi Jinping’s price for holding this week’s meeting with him

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Presidents Donald Trump and Xi Jinping are to meet this week in Osaka. Photo: AP

Wendy Wu,Mark Magnier,Doug PalmerandOwen Churchill

Published: 9:33am, 27 Jun 2019Updated: 10:34am, 28 Jun 2019

This story is part of an ongoing series on US-China relations produced jointly by the South China Morning Post and POLITICO, with reporting from Asia and the United States.

The US and China have tentatively agreed to another truce in their trade war in order to resume talks aimed at resolving the dispute, sources familiar with the situation said.

Details of the agreement are being laid out in press releases in advance of the meeting between Chinese President Xi Jinping and US President Donald Trump at the Group of 20 summit in Osaka, Japan, this weekend, according to three sources – one in Beijing and two in Washington.

Such an agreement would avert the next round of tariffs on an additional US$300 billion of Chinese imports, which if applied would extend punitive tariffs to virtually all the country’s shipments to the United States.

The Trump administration has threatened to slap duties of up to 25 per cent on the remaining untaxed Chinese goods if this weekend’s talks go poorly.

One source with knowledge of the planning said Trump’s decision to delay additional tariffs was Xi’s price for holding the meeting in Osaka.

“The reality, though, is President Trump could always have a change of heart,” the source said. “But the truce cake seems to have been baked.”