More details of Trump’s big non-deal trade fold

More details of the trade deal now at the WSJ:

Michael Pillsbury, an adviser to the president, said he spoke with Mr. Trump, who said the deal calls for China to buy $50 billion worth of agricultural goods in 2020, along with energy and other goods. In exchange the U.S. would reduce the tariff rate on many Chinese imports, which now ranges from 15% to 25%.

…Should Beijing fail to make the purchases it has agreed to, original tariff rates would be reimposed. Trade experts call that a “snapback” provision, though the president didn’t use that term, Mr. Pillsbury said.

In what Mr. Pillsbury described as a “goodwill gesture,” the U.S. plans to announce some tariff rate cuts on Friday. “The president is upbeat and enthusiastic about his breakthrough,” according to Mr. Pillsbury, a China scholar at the Hudson Institute who advises the Trump administration.

The president has stressed that a so-called phase one deal—which also includes measures to improve intellectual property protection, open the Chinese financial services market and prevent currency manipulation—is expected to lead to a phase two deal. That agreement would tackle more difficult problems, including forced-technology transfer, subsidies, and the behavior of Chinese state-owned firms.

Art of the fold! Given the rollbacks were only offered this week this looks pretty desperate.

I’m still skeptical on any big rebound in global growth next year. This does not look like enough to raise Chinese output or productive investment given ongoing uncertainty, Hong Kong and it’s own slowdown.

But it’s enough to fuel risk for now. Or not, via Fox:

Oh dear.

David Llewellyn-Smith
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