China and the US
China needs to resolve fundamental issues with the US
President of the United States, Donald Trump and Chinese Deputy Prime Minister Liu He.
China applauded the signing of a preliminary trade agreement with the United States on Thursday, but stressed that "the fundamental issues" between the two countries still need to be resolved.
The "First Phase" pact demonstrates that Beijing and Washington "can find appropriate and effective solutions to the relevant problems through dialogue," said Chinese Foreign Ministry spokesman Geng Shuang.
China agreed to increase purchases of US agricultural products over two years and stop pressuring US companies to share their technology. The United States abandoned its plans to impose additional tariffs on China.
"It is imperative that the two parties work together, that they defend the principles of equality and mutual respect, that they strictly respect the agreement, that they address the fundamental issues of the other party and work hard to implement the First Phase Agreement," Geng said.
He gave no details, but it is known that China wants the United States to revoke tariffs it imposed earlier, something that does not mention the signed agreement. The US government insists that some measures must remain in force even after the signing of a final agreement, to pressure China to adhere to the agreement.
US President Donald Trump has said he will travel to Beijing to start a second phase of the negotiations, but experts say the issues are now so complex that an agreement is unlikely to be reached until after the US presidential election , in November.
Asian markets reacted with disparate trends following the signing of the agreement. The Chinese market fell 0.5, the Hong Kong rose and the Japanese barely changed.
In general, investors were pleased with the truce in the trade war, but their enthusiasm was tempered by the doubts that China will actually acquire billions of dollars in soy, oil and other agricultural and energy products from the United States.
"This is what you press the pause button," said Stephen Innes, an analyst at AxiTrader. "It is one thing to promise a figure, but another is to fulfill it."