Did the China-U.S.-Switzerland meeting reach a trade protocol? Where did both sides make significant progress?

Author: Uncle Cat Source: X, @Cato_CryptoM

The two-day Sino-American-Swiss meeting has finally brought good news, with both sides stating in major media that this round of consultations has made "significant progress."

However, we need to clearly know what the progress is?

First of all, this significant progress is built on the transition from "refusing to talk" to smoothly carrying out the mechanism of "trade consultations". To put it bluntly, this means that from now on, China and the U.S. will officially engage in detailed consultations on trade, with both sides frequently negotiating trade details, no longer adhering to the previous "ice-cold" international relations.

In simple terms, it means both parties celebrate the successful breakthrough of this trade negotiation.

Therefore, the "symbolic" breakthrough in this trade negotiation is not a fundamental breakthrough.

As of now, the United States has reduced tariffs on China to 30%, while China has lowered tariffs on the United States to 10%. From this data, the U.S. tariffs on China still remain at a historic high and are quite aggressive, whereas China's tariffs on the U.S. have been lowered to a normal level of 10%.

This is not that China has "shrunk back", but rather that China's role and system in the global supply chain differs from that of the United States. China is the main supplier, while the U.S. side is the demand side. Therefore, judging by the current tariff levels between China and the U.S., they still remain at a relatively high level, although this level has decreased from an "outrageous" 145% to a "negotiable" 30%.

The previous 145% from the US was part of the "show-off" series, where the big brother intimidated the little brother. Now, it is a negotiation at the same level, sitting at the negotiation table, which obviously shows a very respectful attitude towards China.

Both China and the United States have stated that regular trade consultations are sufficient to prove this point.

For the global economy, the easing of trade tensions between China and the United States and the avoidance of decoupling has greatly alleviated the pressure on the global economy. In the short term, corresponding safe-haven assets and risk markets will experience significant volatility.

From the perspective of the global economy and risk markets, this significant progress can be seen as a resolution to the China-U.S. trade issue. Although specific tariff policies have not been announced, both China and the U.S. have entered a "normalization" phase in trade negotiations. Regardless of whether the tariff situation is favorable or unfavorable, it has little impact on the market.

Afterwards, the macroeconomic level will gradually return to the economy and related economic data route from the tariff issue!

Key points after the China-U.S. trade negotiations:

A, key brands imported by China

Agricultural sector, such as soybeans, corn, sorghum, wheat and other products, specific tariff policies

Automobile sector, complete vehicle imports, such as Ford pickups, Tesla, and related parts.

Energy sector, natural gas, crude oil, etc.

Aerospace equipment, Boeing, aviation accessories

Medical equipment, etc.

B, key card imported by the US side

High-tech and critical manufacturing, such as chips, Huawei's communication technology, cash machinery manufacturing and electric vehicles, industrial robots, etc.,

Bulk commodities, such as steel, chemical products, rare earths, etc.

Consumer electronics and mid-range manufactured goods, such as mobile phones, laptops, televisions, headphones, etc., also include household appliances.

Agriculture and Light Industry

From the overall details, the reason why the US is concerned about the pressure brought by China's exports is that China basically covers the entire industrial chain, including high, medium, and low-end products as well as important resources.

Therefore, achieving a true victory in trade negotiations is still a long way to go!