WASHINGTON – President Donald Trump and China said Friday they have a "limited" Phase One trade deal – including cancellation of new tariffs on Chinese goods – but investors appeared unimpressed because of a lack of details.
"The China deal covers tremendous manufacturing, farming, a lot of rules, regulations, a lot of things it covers," Trump told reporters at the White House. "It's a Phase One deal, but a lot of big things are covered."
While Trump said he shelved U.S. plans to impose new tariffs on $160 billion of Chinese goods that had been set to take effect Sunday, neither government released text of the proposed agreement.
Trump made the announcement by tweet just minutes after the House Judiciary Committee voted to recommend two articles of impeachment against him.
The missing details included U.S. demands China drop requirements that companies provide intellectual property and technology secrets to the government as conditions of doing business there – key points in an overall trade agreement between the United States and China.
At a news conference in Beijing just before Trump's tweet, Chinese officials confirmed the outlines of the deal.
Wang Shouwen, China’s vice commerce minister, said the mini-deal represents "significant progress” in ending the 17-month-old U.S.-Chinese trade war, and will create "better conditions" between the two countries.
The United States will gradually eliminate tariffs on Chinese goods in phases under the agreement, the Chinese government said. For example, the rate on a September group of $110 billion in tariffs will be cut in half, down to 7.5%.
Stock prices that had climbed Thursday amid reports that a deal was imminent stagnated on Friday after the American and Chinese announcements. But the markets finished slightly up at the end of the day.
Trade analysts described the agreement as a de-escalation of the trade war, but were eager to see the details. Some noted that Trump and China announced a similar deal in October, but no paper agreement was signed and the two sides struggled for weeks to hammer out specifics.
"As we saw in October, preliminary announcements are cheap – let's see the signed text," said Phil Levy, a former White House official who is now Chief Economist of Flexport, a company that arranges and finances trade between 109 countries.
Levy added that people should not expect progress on the "serious underlying issues" – like intellectual property and technology transfer disputes – until after the 2020 presidential election in the U.S.
"This will just unwind some of the damage of the trade war," Levy said.
Tori Smith, a trade economist with the Heritage Foundation, a conservative think tank, said the preliminary news is positive, "but the devil is in the details."
"The most important component we know today is the partial rollback of the September tariffs and a cancellation of Dec 15 tariffs," she said. "This is a positive sign for American families who would have been hit hard on Sunday."
Some lawmakers expressed tentative support.
Sen. John Cornyn, R-Texas, said he is excited about "positive reports" on the agreement, and "I remain cautiously optimistic that the suspension of Sunday’s planned tariff hikes and reduction on existing tariffs will provide needed stability for our economy."
Trump initially announced the deal via tweet, saying "we will begin negotiations on the Phase Two Deal immediately, rather than waiting until after the 2020 Election." He hyped the agreement by saying "this is an amazing deal for all."
In a pair of tweets, Trump said China has "agreed to many structural changes and massive purchases of Agricultural Product, Energy, and Manufactured Goods," but did not provide details.
Earlier in the day, Trump had cast some doubts with a tweet calling into question the details of a deal that had been reported by the Wall Street Journal and other news organizations.
"The Wall Street Journal story on the China Deal is completely wrong, especially their statement on Tariffs," Trump tweeted. "Fake News. They should find a better leaker!"
The Journal and other news outlets reported Thursday that Trump was preparing to cancel tariffs scheduled to take effect Sunday on $160 billion worth of Chinese goods and roll back existing duties on billions of dollars of other imports as part of a Phase One deal.
Chinese officials held their news conference at the same time as the House Judiciary Committee impeachment vote.
Trump met with his trade team Thursday amid what he himself described as encouraging signs in long-running and ongoing trade negotiations with China. Earlier in the day, Trump had tweeted: “Getting VERY close to a BIG DEAL with China. They want it, and so do we!”
Trump's critics hit him over the up-and-down nature of the China trade talks.
"Reports say Pres. Trump sold out for a temporary, unreliable promise from China to purchase some soybeans," tweeted Senate Minority Leader Charles Schumer, D-N.Y. "We've heard this song & dance from China before."
He added that "yet again," Trump "can’t be relied on to do the right thing – even when his statements were pointing in the right direction."
Just last week, Trump suggested that a trade deal might have to wait until after the 2020 election as the talks stalled in part over the question of China’s purchase of soybeans, poultry and other products from U.S. farmers.
Trump has slapped tariffs on $360 billion in Chinese products since trade tensions between the two countries escalated nearly two years ago.
New duties of 15 percent had been scheduled to take effect at 12:01 a.m. Sunday on $160 billion in Chinese goods, including smartphones and other electronics, computer monitors, watches and clocks, plastic kitchenware, clothing, linens, wigs and jewelry.
For more than a year, the U.S. and China have been waging a bitter tit-for-tat trade battle amid accusations that Beijing steals technology from U.S. companies and pressures them to hand over trade secrets in order to do business in China.
When Trump slapped tariffs on Chinese products, Beijing hit back with retaliatory levies on more than $110 billion worth of U.S. goods, including agriculture products, cars, auto parts, chemicals, whiskey, cigars, clothing and TVs.
After months of negotiations, Trump announced in October that his administration had reached a preliminary “Phase One” trade deal with China that called for the Chinese to buy billions of dollars in goods from U.S. farmers, provide market access to U.S. financial companies, tighten intellectual property protections and enact new guidelines for how it manages its currency.
But the preliminary deal was really just a framework, with most of the details still to be worked out. U.S. and Chinese negotiators have been in talks for weeks to finalize the limited agreement but have been haggling over exactly how much agriculture goods the Chinese would buy from American farmers.
Michael Collins and David Jackson cover the White House. Reach Collins on Twitter @mcollinsNEWS and Jackson @djusatoday.
This article originally appeared on USA TODAY: Trump, China claim Phase One trade deal, new tariffs to be cancelled