Incoming U.S.-China 'Phase One' trade deal could lift the Huawei bans
The trade wars between the U.S. and China might take a turn for the better by the end of this month. After almost two years of tensions, the two countries are planning to sign a ‘Phase One” trade deal and the ever increasing export tariffs could be recalculated, which would help bring down prices for a host of goods including computer parts, smartphones, consoles, toys and board games etc.
Speaking of smartphones, Huawei would greatly benefit from such a deal, as it will allow the Chinese company to resume its contracts with U.S.-based component suppliers. Huawei was “strategically” hit when president Trump imposed trade bans for all U.S. companies that supplied components to the Chinese smartphone maker on the basis of national security threats brought up by possible Chinese government espionage tactics. It turned out that the implicated U.S. companies themselves started to oppose these measures as they were causing revenue problems.
The first step towards reaching this “Phase One” agreement was taken back in August, when President Trump announced that he will postpone the planned tariff increases for over US$300 billion worth of goods to December. The trade talks intensified this September and U.S. was preparing to delay tariffs for US$200 billion worth of goods to August 2020. Bloomberg reported this past weekend that U.S. Commerce Secretary Wilbur Ross thinks talks are still going well and a deal could be struck by the end of November.
It is yet unclear if this will prove a deal breaker, but President Trump is requesting that the ‘Phase One’ agreement be signed on U.S. soil, when it was previously convened that the deal may be signed in China.