A preliminary trade deal between the United States and China is “millimeters away,” a senior administration official said on Wednesday.
The comments add to the growing optimism that the U.S. and China can announce a so-called phase one agreement soon after the Thanksgiving holiday weekend.
President Donald Trump has been pushing for a deal that would force Beijing to purchase significant amounts of U.S. agricultural goods after American farmers in the Midwest have been battered by Chinese retaliation during a nearly two-year trade war.
An initial trade deal could also involve a rollback of tariffs that Trump has slapped on roughly $360 billion worth of Chinese goods. Another round of duties is scheduled to hit $160 billion worth of Chinese imports, including consumer goods like laptops and smartphones, on Dec. 15.
The White House has been signaling “cautious optimism” that it could close a deal soon. Work in recent days has included removing brackets from the agreement text that note areas of disagreement and finalizing other areas of the text, said a person briefed by the administration.
Final considerations are being given around how Trump might roll back tariffs to not only include the Dec. 15 round but also another set of import duties that were slapped on roughly $110 billion worth of Chinese goods on Sept. 1.
The possibility of phasing out tariffs on the first three rounds, which affected about $250 billion worth of Chinese imports, is also under consideration, said another person close to the talks.
Trump has said the phase one deal will require China to purchase up to $50 billion worth U.S. farm goods within two years. The deal is also expected to have China to deliver on long-held commitments to open its financial services sector and implement certain intellectual property protections.
However, it’s unclear the extent to which a preliminary deal will force China to address structural issues, such as its support of state-owned companies. Such bigger concerns led to the trade fight over forced technology transfers and subsidies.
Trump said the two sides would enter a second and even third phase of trade talks to address other issues.