Optimism has been scarce on the financial markets for a while now. However, hope is not altogether dead, as the United States and China agreed to restart their trade negotiations during the G20 summit a week ago. After the world’s two biggest economies spent almost two months exchanging hostilities, this week American and Chinese negotiators are finally scheduled to sit back down and talk about a trade agreement.
According to preliminary report, China has agreed to import more agricultural products from the United States, while President Trump has promised a more relaxed treatment of Chinese tech giant Huawei, which recently got blacklisted in America, reportedly due to security concerns.
Nevertheless, the reason for the previous fallout in the trade talks wasn’t food or Huawei. It was the United States’ insistence that China implements large-scale reforms regarding its international business policies. From the very beginning of the trade war, the United States had an issue not with the trade deficit Trump likes to talk about, but with China’s access to US intellectual property and for using the know-how to build its own alternative products.
Analysts are pessimistic about the probability that after over a year of being subjected to heavy tariffs without budging, China would somehow give way now. So while the initial news after the G20 summit helped calm the markets somewhat, now that optimism is beginning to wear thin.
