Trade dispute: Chinese government announces massive tariff cuts

China plans to cut import tariffs on 850 products next year. The Ministry of Finance in Beijing said that it was about pork, avocados or certain computer chips. The tariff cuts affect imports, which according to calculations by the finance agency Bloomberg, reached a volume of $ 389 billion in 2018. They should not only relieve the burden on consumers and boost domestic demand, but also promote the development of the high-tech industry.

Second and probably even more important point: Private investors are to be given easier access to the markets for oil, telecommunications and energy production, and companies already operating in China are to be given the same legal status as the state. However, the communication does not indicate whether the relief also applies to foreign companies.

At first it also remained open whether the announced measures were connected with the trade dispute with the USA. It is also conceivable that this is intended to slow the decline in economic output. It had dropped to six percent in the past quarter, the lowest level in three decades.

US President Donald Trump has announced that both countries will "very soon" sign the first stage of their agreement to resolve the conflict that has been going on for months. A breakthrough was achieved, Trump said at an event in Florida on Saturday.

The agreement on the so-called "first phase" of the agreement had been announced a few days ago. The United States and China have been imposing tariffs and counter tariffs for months, which has also affected the global economy.