WASHINGTON – President Donald Trump is 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 officials said the two countries are moving closer to a “Phase One” trade deal.
The tariff relief appears to signal an easing of tensions between the world’s two largest economies, which have been locked in a bitter trade war with each other for nearly two years.
Two administration officials discussed the details on condition of anonymity because negotiations are ongoing.
Trump suggested just last week that a trade agreement with China might have to wait until after the 2020 election. But he raised hopes for a deal on Thursday, writing on Twitter: “Getting VERY close to a BIG DEAL with China. They want it, and so do we!”
The stock market climbed after Trump’s remarks, with the S&P 500 gaining 0.9 percent to close at a record high. The Dow Jones Industrial Average closed 220 points, or 0.8 percent.
Negotiators for the U.S. and China have been working for weeks to finalize a “Phase One” trade deal between the two countries. Trump announced the framework for such a deal in October, but negotiators have struggled to agree to specific terms.
New tariffs of 15 percent were 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.
Trump is preparing to cancel those duties and roll back existing tariffs he has slapped on another $360 billion worth of Chinese imports since the trade tensions started. Those tensions flared amid allegations that China steals U.S. intellectual property and forces American companies to divulge their trade secrets as the cost of doing business in China, officials said.