U.S President Donald Trump has signed the first phase of a new trade agreement with China. This is coming after two years of tension between the two superpowers that have unsettled economies around the world.

Trump and China’s chief trade negotiator, Liu He, signed the deal at a packed press conference, attended by Ivanka Trump, much of Trump’s cabinet, Henry Kissinger, and media and business leaders including Stephen Schwarzman, the chairman of Blackstone, and Ajay Banga, the president of Mastercard. The signing came hours after Democrats named the team that will prosecute Trump in an impeachment trial that starts early next week.

During the event, US President, Donald Trump stated: “Today, we are taking a momentous step towards a future of fair and reciprocal trade. Together we are righting the wrong of the past… At long last Americans have a government that puts them first at the negotiating table.” He also claimed that the deal was the biggest deal anybody had ever seen which may just be one of  Trump’s many tantrums.

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The first phase of the deal will further open the Chinese market to US companies and in turn, will see Chinese firms purchase American goods and service worth roughly $200bn. But it will also leave in place much of the $360bn worth of tariffs that the US has already imposed on Chinese goods, and the threat of additional punishment if Beijing does not live up to the terms of the deal.

Trump campaigned on tackling what he saw as China’s unfair trade practices, accusing the country of “raping” the US and perpetuating “the greatest theft in the history of the world”.

The often rancorous trade dispute has hurt agriculture, manufacturing and other sectors of the US economy, and the uncertainty it has engendered has worried business leaders. But its impact on the broader economy does not appear to have been as dire as some predicted.

The trade deal, if it holds, could be a major political boost for Trump in an election year when he can argue his tough stance with China has paid off. US stock markets hit new record highs ahead of the signing.

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(source)