White House economic adviser Lawrence Kudlow said that President Trump likes the direction of the “phase one” trade deal that the U.S. is working with China to finalize, but he isn’t ready to sign just yet.
“The mood music is pretty good,” Kudlow said during a Nov. 14 event at the Council on Foreign Relations. “[President Trump] likes what he sees, he’s not ready to make a commitment, he hasn’t signed off on a commitment for phase one, we have no agreement just yet for phase one.”
President Trump and Chinese President Xi Jinping originally planned to sign the finalized deal at the Asia-Pacific Economic Cooperation summit in Chile, but due to civil riots in the area, the plan was canceled. China and the U.S. also face conflicting interests with the “phase one” deal as it is being negotiated. President Trump said that China agreed to purchase up to $50 billion worth of agricultural products, such as park and soybeans, but the Wall Street Journal reported that China is cautious about putting a numerical commitment in the deal. The publication stated that China wants to keep the deal flexible in case trade tensions with the U.S. rise again.
In addition, China is pushing the U.S. to completely remove the existing Section 301 tariffs under the agreement, while the U.S. plans to rollback duties in increments to continue to have leverage in case China doesn’t keep promises in the agreement.