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Threat to world economy lifts as Trump agrees to trade-war-truce with China

Xi opened the meeting with a reference to the ping-pong diplomacy in the 1970s that paved the way for formal diplomatic ties between the U.S. and China.

world Updated: Jun 29, 2019 11:00 IST
Shawn Donnan, Margaret Talev  and Peter Martin
Shawn Donnan, Margaret Talev and Peter Martin
Bloomberg
U.S. President Donald Trump meets with China's President Xi Jinping at the start of their bilateral meeting at the G20 leaders summit in Osaka, Japan, June 29, 2019. REUTERS/Kevin Lamarque
U.S. President Donald Trump meets with China's President Xi Jinping at the start of their bilateral meeting at the G20 leaders summit in Osaka, Japan, June 29, 2019. REUTERS/Kevin Lamarque(REUTERS)
         

President Donald Trump and China’s Xi Jinping agreed to another truce in their trade war Saturday, removing an immediate threat looming over the global economy even as a lasting peace remains elusive, claimed a Bloomberg report.

“The two leaders signed off on the terms during a lunch meeting on the sidelines of a Group of 20 meeting in Japan”, the report said.

It also quoted Xinhua News Agency as saying “the two sides have agreed to restart trade negotiations that broke down last month.”

President Donald Trump had hinted at the likely truce at the start of his meeting with Chinese premier Xi Jinping on Saturday by clearly stating the two sides were “getting a little bit closer”.

“I think it’s something that’s actually very easy to do. I actually think that we were very close and then something happened where we slipped a little bit, and now we’re getting a little bit closer. But it would be historic”, Trump had told Xi at their meeting in Japan on the G20 sidelines.

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Premier Xi was the first to seek co-operation when he opened the meeting with a reference to the ping-pong diplomacy in the 1970s that paved the way for formal diplomatic ties between the U.S. and China.

“China and the United States both benefit from cooperation and lose from confrontation,” Xi said in prepared remarks.

A temporary freeze on further U.S. tariffs, as well as Chinese retaliation, while talks get back under way was discussed by negotiators before the leaders met for lunch, according to people briefed on the talks who asked not to be identified.

After almost a year of trade war, the stakes couldn’t be much higher. A return to the negotiating table would end a six-week stalemate that’s unnerved companies and investors, and end the threat of a further escalation. Failure to do so would likely upset financial markets already whipsawed by mounting risks to a slowing global expansion.

Trump earlier Saturday signaled the U.S. had made progress in trade discussions with China ahead of the lunch meeting in Japan.

Speaking with reporters Saturday, Trump said that he would be discussing the U.S. blacklisting of Huawei Technologies Co. as well as a broader trade deal. He also said the two leaders and their negotiators had made progress during preparatory discussions on Friday evening.

“A lot was accomplished actually last night,” Trump said prior to meeting Xi. “The relationship is very good with China. As to whether or not we can make a deal, time will tell, but the relationship itself is really great,” Trump said, adding that he and Xi continued to have “a very good friendship.”

(All inputs in this story are from wire agency feeds . The headline has been changed.)

First Published: Jun 29, 2019 09:01 IST

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