Trade Minister Simon Birmingham haswelcomed the “temporary truce” in the escalating US-China trade war announced at the weekend.
“The threat of ever escalating tariffs and trade tensions would have been bad for economic growth, globally,” Senator Birmingham said.
“It does calm global markets and we know that a prolonged trade war and escalation of tariffs between the US and China would have dampened global economic growth. That would have been bad not only for consumers and businesses in the US and China but ultimately for all nations in terms of that slower rate of economic growth.
“So, the fact that these talks have been positive, that there will be ongoing discussions, that there has been at least a temporary truce in terms of an escalation of further tariffs – that's all welcome news.
“We encourage the two nations to continue their dialogue and ultimately to back an opening of economies and to stand against protectionism.”
US President Donald Trump and Chinese President Xi Jinping reached the trade war truce as they met across a dinner table at the G20 summit in Buenos Aires, Argentina on Saturday.
State-run China Daily and Chinese international broadcaster CGTN both said Trump and Xi agreed to not add additional tariffs “after January 1” – when Washington was set to raise the tariff rate on US$200 billion of Chinese imports from 10 per cent to 25 per cent.
Details of the trade truce agreement, including what concessions China made, were not immediately disclosed. Senior Trump adviser Larry Kudlow said the talks went “very well,” but would not elaborate.
Dinner discussions about de-escalating tensions between the world’s two largest economies lasted an hour longer than expected.
Both sides appeared satisfied at the end of the gathering, with applause heard in the room as the dinner drew to a close.
Shortly after the meal ended, the White House released a statement with comments the two presidents made before entering the dinner venue, quoting Trump as saying his relationship with Xi was “very special”.
“I think that is going to be a very primary reason why we’ll probably end up – ending up getting something that will be good for China and good for the United States,” Trump said.
Relations between the two superpowers have been strained since the trade war began nearly four months ago.
In July and August the US imposed 25 per cent tariffs on US$50 billion worth of Chinese imports. China retaliated in a tit-for-tat manner by levying the same tariff rate on the same amount of US products.
In late September the US imposed 10 per cent tariffs on US$200 billion worth of Chinese products. China then responded by slapping duties ranging from 5 to 10 per cent on US$60 billion worth of American imports.
First meeting since trade war began
Also, President Trump has demanded that China rescind policies that force foreign companies operating in the country to transfer technology, source code or encryption keys to their local joint-venture partners.
The G20 meeting was the leaders’ first since the trade war began.
Senator Birmingham said the Australian Government had been urging the two parties to talk.
“We hope that provides a permanent solution,” he said.
Preferential access into export markets
Meanwhile, the Australian government would continue to aggressively pursue the interests of Australian farmers, Australian businesses, to sell more of their goods to the world.
“We've seen (Prime Minister) Scott Morrison provide real leadership at the G20 in terms of driving discussions for further trade and market access for Australian farmers and businesses into the EU and UK,” Senator Birmingham said.
“Five and a half years ago when we were elected as a Government, only 20 odd per cent of goods and services could get preferential or tariff-free access into export markets.
“Now, that stands at around 70 per cent, and as a Government, if we keep doing our trade deals that we’ve done, get them done with the European Union and the UK as our next key targets, that's going to nudge closer to 90 per cent of Australian goods and services being able to get preferential tariff-free access into markets.”