One of the main highlights of the G20 Summit is the resumption of talks between US president Donald Trump and his Chinese counterpart President Xi Jinping.
Source: Vox

One of the main highlights of the G20 Summit is the resumption of talks between US president Donald Trump and his Chinese counterpart President Xi Jinping. Interestingly, this development comes after a seven-week breakdown between the US and China. The multimillion-dollar tariff war has been successfully averted after the timely intervention of the two leaders. The tariff war has roiled global markets and threatened the future of the world’s two largest economies.

A temporary respite from the trade meltdown

The two world leaders came to this agreement, which took place for more than an hour. However, the talks did not signal any breakthrough to resolve the long-standing conflict. But as per many political experts, it did denote a temporary respite from the long-standing trade hostilities between the two supreme powers of the world. On the flipside, it also provided a great chance to forge a permanent accord which governs the trade flow between the two nations for the negotiators and diplomats of the two countries.

The United States would not be adding a tariff on Chinese imports

After the meeting on the sidelines of the G20 summit held in Osaka, Japan, Mr. Trump confirmed that the US would not add taxes on 300 billion dollars’ worth of Chinese imports. On a further note, he also said that he would continue to negotiate with his Chinese counterpart for the time being. The ban that was imposed by the US commerce department that companies in the United States cannot sell to Chinese companies was also reversed. After the resumption of talks, President Trump agreed that the US companies can now sell to China’s Huawei.

Businesses on both sides are affected

Trades on both these countries are severely affected as there are several ongoing restrictions. Interestingly, the Chinese businessmen are worse affected as the trade war between the two nations has severely affected the investment plans. Moreover, the business confidences of newbie entrepreneurs are worst hit. But it would be wrong to assume that the trade wars between these two superpowers are over for the time being. A slight resumption of talks doesn’t indicate that the economic war is over between them.

Washington wants Beijing to mend its way

It is important here to note that the leadership of the US wants Beijing to improve its current trade policies that are in existence nowadays. Over the past four decades, the way the Chinese economy has grown has sent danger signals to the US. US wants China to get rid of subsidies to its state-owned companies and open up the domestic market so that the US can invest in it. But Beijing has already maintained its stand on this issue and has said that it would not budge or bow to the pressure inflicted upon by the US.

How the two sides negotiate a way out will be a test of any trade battle. But for the time being, the only positive is they are talking again.

Related: U.S. Government Will Pay $4.7 Billion to Farmers Affected by Trade Wars