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Confusion over US-China trade war truce

BBC News logo BBC News 04/12/2018
Xi Jinping and Donald Trump © Getty Images Xi Jinping and Donald Trump

A proposed cut by China to tariffs on US car imports created confusion in Washington, a day after it was announced by US President Donald Trump. 

Beijing has not yet confirmed the move and President Trump's advisers appeared less certain about the agreement.

Uncertainty also surrounded the details of the broader trade war truce struck by the US and China at the G20 summit.

Amid scant details, carmaker Ford told the BBC it's "looking forward to learning more" about the truce.


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The US accuses China of unfair trading practices and tariffs are intended to counter Chinese practices that make it difficult for American companies to compete. 

Tariffs, in theory, make US-made products cheaper than imported ones, and encourage consumers to buy American.

U.S. President Donald Trump, U.S. Secretary of State Mike Pompeo, U.S. President Donald Trump's national security adviser John Bolton and Chinese President Xi Jinping attend a working dinner after the G20 leaders summit in Buenos Aires, Argentina December 1, 2018. REUTERS/Kevin Lamarque © Reuters U.S. President Donald Trump, U.S. Secretary of State Mike Pompeo, U.S. President Donald Trump's national security adviser John Bolton and Chinese President Xi Jinping attend a working dinner after the G20 leaders summit in Buenos Aires, Argentina December 1, 2018. REUTERS/Kevin Lamarque

After months of escalating threats, Washington and Beijing said they had reached a temporary agreement in their bruising trade dispute at the G20 meeting in Argentina over the weekend.

Central to the deal was an agreement between President Trump and China's President Xi Jinping to not increase tariffs for 90 days to allow for talks.

The US president later said in a tweet that Beijing had "agreed to reduce and remove tariffs on cars coming into China from the US".

His comments relate to the 40% tariff China imposes on US vehicle imports, which were brought in as part of the trade battle in July. The rate is much higher than the 15% it places on other trading partners and forced many carmakers in China - the world's largest car market - to raise prices.

U.S. President Donald Trump attends a meeting with German Chancellor Angela Merkel during the G20 leaders summit in Buenos Aires, Argentina December 1, 2018. REUTERS/Luisa Gonzalez © Reuters U.S. President Donald Trump attends a meeting with German Chancellor Angela Merkel during the G20 leaders summit in Buenos Aires, Argentina December 1, 2018. REUTERS/Luisa Gonzalez

The day after the announcement, there was confusion over the details in Washington, with senior figures in the White House contradicting each other.

Asked whether China would remove the 40% auto tariffs Larry Kudlow, the US president's top economic adviser, said he "believed that commitment was made".

In a briefing to reporters, he also said the US did not yet have a "specific agreement" on auto tariffs.

Another senior White House figure, trade adviser Peter Navarro, said only that the issue "certainly came up" in discussions at the G20.

Confusion has also arisen over when the agreed 90 day period for negotiations will kick in, with some saying it begins now, others claiming it's January.

Ford is just one major company looking for clarity. The US automaker said it was "encouraged by the trade discussions" as it awaited more detail.

"We look forward to learning more," Ford said in a statement.

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