(Bloomberg) -- The U.S. is willing to suspend the next round of tariffs on an additional $300 billion of Chinese imports while Beijing and Washington prepare to resume trade negotiations, people familiar with the plans said.
The decision, which is still under consideration, may be announced later this week after a meeting between Presidents Donald Trump and Xi Jinping at a Group of 20 summit in Osaka, Japan. A broad outline of the Trump-Xi agenda was discussed in a phone call Monday between Robert Lighthizer, the U.S. trade representative, and his counterpart in Beijing, Vice Premier Liu He.
People familiar with the American readout of the conversation characterized the call as productive.
The U.S. won’t accept further conditions on tariffs as part of reopening negotiations and no detailed trade deal is expected from the leaders’ summit, a senior administration official said on Tuesday. The Trump-Xi meeting is scheduled to be on Saturday, the final day of the two-day G-20, according to another U.S. official.
Although each side still wants significant concessions from the other, both agreed to dial down the tit-for-tat responses and aim for an extended truce that could soothe financial markets, people familiar with the situation said. It’s not clear if they would set a definite timetable for their tariff truce.
Trade War
The talks between the leaders of the world’s two largest economies marks a critical juncture in their nearly year-old trade war, and both sides have plenty to lose if it escalates. Trump is riding a strong economy and booming stock market into his reelection campaign. China’s economy has been slowing, and U.S. tariffs are encouraging some foreign companies to shift production or plan investment elsewhere to avoid the higher costs.
People familiar with the U.S. thinking said the White House wants to avoid setting and missing a deadline like it did last time the two leaders met in Buenos Aires and agreed to a 90-day pause in the trade war.
Lighthizer and other Trump advisers then said publicly the date was a hard deadline and would result in more tariffs if Beijing didn’t come to the table with satisfactory proposals, though it was extended several times. When negotiations broke down last month, Trump raised tariffs on $200 billion of Chinese goods to 25% from 10%.