Washington — The U.S. and China announced a preliminary trade agreement Dec. 13, but most U.S. tariffs on Chinese machinery, resins and products appear to be unchanged.
The two governments announced what they were calling a phase one agreement that would cancel U.S. tariffs set to go into effect Dec. 15 and also lower tariffs that were put in place in September, from 15 percent to 7.5 percent.
But the deal will largely preserve tariffs on Chinese imports imposed in three earlier rounds, which included plastics machinery, resins and some products.
Those tariffs, on $250 billion in Chinese imports, would remain at their current 25 percent level.
Other aspects of the deal are unclear. One Washington-based resin industry official closely monitoring the agreement said it's not clear if Beijing will lower any retaliatory tariffs it put in place on U.S. exports of plastic materials, a key sticking point for the U.S. industry.
China agreed to "substantial" purchases of U.S. goods and services in coming years, the Trump administration said.
It's also not clear how the Dec. 13 agreement could impact the push by the U.S. mold making sector to reinstate 25 percent tariffs on Chinese injection molds. Mold tariffs were put in place in July 2018, but in December 2018 they were rescinded for a year.
Mold makers and mold buyers are currently arguing before the U.S. Trade Representative on whether to bring the tariffs back. USTR needs to decide by Dec. 28.
A statement from the Office of USTR Robert Lighthizer called the pact a "historic and enforceable agreement on a phase one trade deal that requires structural reforms and other changes to China's economic and trade regime in the areas of intellectual property, agriculture, financial services, and currency and foreign exchange."
Lighthizer said it "begins rebalancing the U.S.-China trade relationship."
Jay Timmons, the president and CEO of the National Association of Manufacturers, called the deal "an enormous step forward" toward a trade agreement that protects U.S. intellectual property and fights counterfeiting.
The U.S. Chamber of Commerce called on the two governments to reach a phase two agreement within six months, which it said should address Chinese subsidies, forced technology transfer and digital issues.
Other business groups, like the Americans for Free Trade coalition that includes the American Chemistry Council and the Vinyl Institute, called the agreement a "small step forward" and urged the Trump administration to reduce all tariffs. An ACC spokesman said the group wanted to review the details of the agreement before commenting.