China is still calling for the United States to roll back trade tariffs as part of any phase one deal, as dialogs between the world’s two major economies drag on. Spokesperson of the China’s Ministry of Commerce Gao Feng said that the trade dispute began with imposing tariffs and should end by withdrawing these additional tariffs. It is an important state for both countries to reach an accord, Feng added. Furthermore, he said if both economies reach a phase one deal, the level of tariff removal will completely reflect the importance of phase one. Nothing the two sides trade delegations are in profound consultations on this subject.

The trade war between China and the United States continued for well more than one year, with each side charging tariffs on billions of dollars’ worth of goods from the other. Now, both sides are in the process of stopping what’s termed as “phase one” agreement to address some points of disagreement. Xi Jinping, the President of China and Donald Trump, the president of the United States, expected to meet in the mid of Nov at the Asia-Pacific Economic Cooperation conference in Santiago, but Chile disregarded the event in late Oct due to national unrest.

Gao did not particularly address a comment of United States president last week that he didn’t agree to roll back tariffs on Chinese goods. The spokesperson of the Commerce Ministry also didn’t directly give remarks on news reports that a challenge to reaching a trade deal is the unwillingness of China to put specific amounts of the United States farm purchases into writing.

Both Countries struggles to cope with the Tariffs

Meanwhile, anecdotal evidence and data indicate businesses from both nations tried several ways to cope with the tariffs. For some firms in the U.S., diverting production or the import’s sourcing is an option. Worldwide trade lead at the Economist Intelligence Unit (EIU), Nick Marro said in an email Thursday that from a regional perception, we have seen a major rise in exports intended to the United States from markets such as Taiwan and Vietnam. He said that it’s improbable either, however, that either economy has the existing capacity of production to entirely explain that story, indicating that trans-shipments might be playing a good role.

The major risk here is that this kind of tariff evasion is unlawful under trade law of the United States, and so some firms – as well as some countries might exposing themselves to the risk of disciplinary United States trade actions in reply. On the other side, several Chinese firms selected to absorb what tariff costs they can, instead of pass it on to customers.

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