What happened at the trade meeting between the U.S. and Chinese presidents is not quite a “he said, she said” situation. It’s more like accurately “Trump said, Xi said.”
President Donald Trump met with Chinese President Xi Jinping on Dec. 1 during the G20 Summit. Little solid information has come out about the contents or outcome of the meeting aside from what each leader or their administrations have said about it. Unfortunately, the details differ substantially where agricultural interests are concerned.
Both Trump and Xi agree that the meeting was valuable, however.
A statement from the U.S. Press Secretary following the meeting quoted Trump as saying, “This was an amazing and productive meeting with unlimited possibilities for both the United States and China. It is my great honor to be working with President Xi.” Similarly, a Chinese-government announcement of the meeting called the meeting “very successful.”
On Twitter the following day, the president variously called the meeting “extraordinary” and said that “Relations with China have taken a BIG leap forward!”
The other area where both sides agreed was on the matter of fentanyl, a fast-acting opioid considered a part of the “opioid crisis” in the U.S. Prior to the meeting, Trump urged Xi to designate the drug a controlled substance and criminalize those who produce and sell it illicitly to the U.S. to the fullest extent of Chinese law, including applying the death penalty.
According to the Chinese announcement, Xi agreed to list fentanyl and fentanyl-like products as controlled substances. The White House called this “a wonderful humanitarian gesture.” In a pair of tweets, Trump praised this as one of the most exciting parts of the meeting.
U.S. version on trade
The meeting, as described by official U.S. announcements and Trump himself via Twitter, included numerous trade and tariff concessions by China. Trump claimed via a Dec. 2 tweet that China will drop its 40 percent tariff on U.S. automobiles. The U.S. Press Secretary statement said China “agreed to start purchasing agricultural product from our farmers immediately,” and explained that the potential Jan. 1, 2019 tariff increase against China will be postponed pending the results of a 90-day negotiation period.
In an early-morning tweet on Dec. 3, Trump proclaimed the meeting a success for agriculture.
“Farmers will be a very BIG and FAST [sic] beneficiary of our deal with China. They intend to start purchasing agricultural product immediately. We make the finest and cleanest product in the World, and that is what China wants. Farmers, I LOVE YOU!”
Chinese-government communications did not refer to any of the points stressed by the White House or President Trump. The closest reference was the Chinese official statement’s description of the two leaders “reaching important consensus and agreeing not to impose new additional tariffs.”
Other government-controlled Chinese news media quoted different Chinese economy officials repeating the line that both leaders had agreed “not to impose new additional tariffs” and “to step up negotiations toward the removal of all additional tariffs.”
Chinese-government statements were almost completely silent on the topic of the 90-day negotiations postponing the proposed $200 billion in increased tariffs. The closest reference came on Wednesday morning by an unnamed Chinese Ministry of Commerce official, who said:
“The economic and trade teams of the two sides will actively promote the consultation work within 90 days in accordance with a clear timetable and road map.”
Shaken confidence
The U.S. markets reacted positively to the news of the agreement Monday, Dec. 3. For example, the Dow Jones Industrial Average rose just over 300 points (about 1.2 percent) on Monday.
Also on Monday, USDA Secretary Sonny Perdue spoke at the keynote session of the DTN Ag Summit. There he voiced his excitement about the “promising news” of the meeting between Trump and Xi, but also voiced skepticism.
“From my perspective, nothing has changed from the tariff damage that farmers experience,” Perdue told the crowd, as reported by DTN’s Chris Clayton.
That skepticism spread to the markets on Tuesday, Dec. 4 following a series of threatening early-morning tweets from the president. In a trio of tweets, Trump reiterated the 90-day deadline to see “whether or not a REAL deal with China is actually possible.” If not, he reminded Twitter that he is “a Tariff Man.”
“When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so. It will always be the best way to max out our economic power. We are right now taking in $billions in Tariffs.”
The Dow Jones fell almost 800 points (3.10 percent) on Tuesday with several mainstream news and economic news outlets putting the fall at least partially on Trump’s statements both on and off Twitter.
A White House transcript of Trump’s remarks to the press gaggle onboard Air Force One immediately following the meeting quoted him as hedging the trade agreement with China, saying, “It’s an incredible deal. It goes down, certainly—if it happens, it goes down as one of the largest deals ever made.”
Similarly, Treasury Secretary Steven Mnuchin cast doubt on the agreements when he spoke to the Fox Business Network on Tuesday. He hedged a discussion of China’s supposed agreement to buy $1.2 trillion in U.S. goods, saying “if that’s real.”
“The sense is that there’s less and less agreement between the two sides about what actually took place,” said Willie Delwiche, investment strategist at Baird, as quoted by the Associated Press.
“There was a rally in the expectation that something had happened. The problem is that something turned out to be nothing.” — WLJ
