Donald Trump, Xi Jinping agree to ceasefire in tariff war after G20 dinner date, as US goes it alone on climate change
The tariff ceasefire was announced after Mr Trump, Mr Xi and key officials sat down for dinner. (Reuters: Kevin Lamarque)
The White House says US President Donald Trump and Chinese President Xi Jinping have reached a 90-day ceasefire agreement on new economic tariffs to allow for continuing trade negotiations.
- Mr Trump has agreed not to go ahead with new US tariffs on Chinese imports planned for January 1
- European Union officials say the US was the main holdout on nearly every issue, including climate change
- Angela Merkel says “everyone agrees that the WTO should be reformed”
The two met for dinner in Buenos Aires, Argentina at the end of the G20 meeting.
White House press secretary Sarah Sanders said Mr Trump had agreed not to raise US tariffs on Chinese imports as scheduled on January 1.
“China will agree to purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial, and other product from the United States to reduce the trade imbalance between our two countries,” Ms Sanders said.
She added that the two countries would “immediately begin negotiations on structural changes” around intellectual property protections, cybertheft and other US priorities.
Chinese state television reported “no additional tariffs will be imposed after January 1, and negotiations between the two sides will continue”.
“This was an amazing and productive meeting with unlimited possibilities for both the United States and China,” Mr Trump said in a statement.
“It is my great honour to be working with President Xi.”
Tariffs on $US200 billion in Chinese goods were set to rise from 10 per cent to 25 per cent in the new year, and Mr Trump was considering duties on even more Chinese goods.
The White House said Mr Trump would impose the tariffs if the two sides did not reach agreement within 90 days.
Earlier, Australian Trade Minister Simon Birmingham cautiously welcomed the original Chinese reports of the agreement.
Tweet from Simon Birmingham: “If accurate this will be an important and welcome breakthrough that reduces the threat to global economic growth. Australia will continue to encourage both countries to keep talking & to work with other willing nations to further strengthen global trading rules.”
Agreements on trade reform, but dissent on climate change
Earlier, G20 leaders pledged to fix the world trading system after difficult, all-night talks in the Argentine capital, but only 19 of them agreed to support the Paris accord on fighting climate change, with the United States the lone holdout.
The official summit statement acknowledged flaws in global commerce and called for reforming the World Trade Organisation (WTO).
It did not mention the word “protectionism,” however, after negotiators said that had met resistance from the United States.
Applause broke out in the summit hall as the leaders, including Mr Trump, signed off on a final statement at the end of a two-day summit.
The non-binding agreement was reached after talks by diplomats stretched overnight and into daylight on Saturday, amid deep divisions between member nations.
European Union officials said the United States was the main holdout on nearly every issue.
Mr Trump has criticised the WTO and taken aggressive trade policies targeting China and the EU.
But China also pushed back in talks on steel, South Africa objected to language on trade, Australia did not want the statement to be too soft on migration and Turkey worried it would push too far on climate change, according to the officials.
A senior White House official said the joint statement met many US objectives, and stressed it included language about WTO reform.
The official also noted other elements such as language on workforce development and women’s economic development and a commitment by China to doing infrastructure financing on “transparent terms”.
According to the official, the language on climate was necessary for Washington to sign on, and Turkey, Saudi Arabia and Russia had appeared sympathetic to the US position but ultimately stayed with the other countries.
With trade tensions between the US and China dominating the summit, the Europeans sought to play mediator. They also scaled back their expectations, cutting out mention of rising protectionism, mainly aimed at Mr Trump.
Migration language minimised to appease Trump: official
The final language of the statement said, regarding climate, that 19 nations that are signatories to the Paris accord reiterated their commitment to it while the US reiterated its decision to withdraw.
It also noted a recent UN report that warned damage from global warming would be much worse than previously feared, and expressed support for an upcoming UN climate meeting in Poland meant to nail down how countries would meet promises made in the Paris accord.
On global commerce, the statement said the 20 countries support multilateral trade but acknowledge the current system does not work and needs fixing, via “the necessary reform of the WTO to improve its functioning”.
On migration, European officials said the US negotiator said too much talk about it would have been a “deal-breaker” for Mr Trump. So they came up with “minimalist” language that acknowledged growing migrant flows and the importance of shared efforts to support refugees and solve the problems that drive them to flee.
China, led by Xi Jinping, has committed to doing infrastructure financing on “transparent terms”, according to a senior White House official. (AP: Natacha Pisarenko)
The statement also showed a commitment to a “rules-based international order,” despite Mr Trump’s rejection of many of those rules.
“There were moments when we thought all was lost,” one European official said, “moments when we spent two hours on one sentence.”
The officials spoke on condition of anonymity to discuss the closed-door negotiations.
‘Leaders buried their differences in obscure language’
Thomas Bernes of the Canada-based Centre for International Governance Innovation, who has held leading roles with the International Monetary Fund, the World Bank and the Canadian Government, said the G20 had “veered all over the road” at the summit and failed to truly fix trade.
The US was out of step on migration and climate change and blocked meaningful agreement on those issues, he added.
“Instead, leaders buried their differences in obscure language and dropped language to fight protectionism, which had been included in every G20 communique since the leaders’ first summit,” he said.
“This is clearly a retrograde step forced by United States intransigence.”
“The question is whether we are burying the G20 in the process,” Mr Bernes added.
“Certainly this is a big hit to the credibility of the G20 to provide resolute leadership in addressing global problems.”
Merkel addresses Ukraine tensions with Putin
Angela Merkel spoke with Russian President Vladimir Putin (pictured with Japanese Prime Minister Shinzo Abe) about rising tensions in the Kerch Strait. (Sputnik/Mikhail Klimentyev/Kremlin via Reuters)
Perhaps surprisingly, one country that was seen as particularly constructive was Russia, the EU officials said.
While a statement is not legally enforceable, the Europeans see it as proof the G20 is still relevant and multilateralism still works.
“Everyone agrees that the WTO should be reformed,” German Chancellor Angela Merkel said. “This is an important agreement.”
“We will send a clear signal — in any case, most of us” — for the success of global climate talks starting in Poland on Sunday, Ms Merkel added.
Ukranian ships were travelling from Odessa to Mariupol when they were stopped in the Kerch Strait. (ABC News: Graphic by Jarrod Fankhauser)
Ms Merkel’s spokesman said that during a meeting with Russian President Vladimir Putin, she also voiced concern about rising tensions in the Kerch Strait off Crimea and pushed for “freedom of shipping into the Sea of Azov”.
Last weekend, Russia seized three Ukrainian naval vessels and their crews in an incident escalating a tug-of-war that began in 2014 when Russia annexed Ukraine’s Crimean Peninsula and supported separatist rebels in eastern Ukraine.
Germany and France have sought to mediate between Russia and Ukraine, and spokesman Steffen Seibert said Ms Merkel and Mr Putin agreed the four countries should hold further talks at the “adviser level”.
The next G20 summit will be held in Osaka, Japan, in June 2019.