The agreement between the Presidents of the United States and China at the weekend to suspend their trade war will be welcomed everywhere. It is just a 90-day ceasefire but it contains the ingredients for a return to normal trade rules.
Donald Trump has agreed to suspend the latest tariff increases he had planned to impose on selected Chinese imports from January 1 and Xi Jinping has agreed not to impose retaliatory tariffs on a range of American imports to China, notably agricultural products.
Returning from the G20 summit in Buenos Aires, Trump described the agreement as "an incredible deal" that will have an "incredibly positive impact on farming". Trump has clearly been feeling some heat from American farmers over his trade war and no wonder. China is a big importer of American products such as soybeans and pork and has retaliated strongly.
Sales of US soybeans to China had dropped by 98 per cent this year. Pork exports fell by 36 per cent from January to September. US farm incomes are expected to fall 13 per cent this year and farm debt levels are forecast to hit their highest in a decade.
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Trump has increased farm subsidies by US$12 billion this year to compensate for some of their losses but farmers fear their big Chinese markets will be permanently lost to other producers such as Brazil and Argentina unless the trade war ends soon.
Trump seems to be listening, if only because the Midwestern farming states are among those he won in 2016 and will need to win again in 2020. But there is reason to hope he has realised trade is a two-way street and he is harming as many Americans as he thinks he is helping.
Publicly he presents the "incredible deal" as another weighted in America's favour. While he would be "holding back on tariffs, China will be opening up", he said. "China will be getting rid of tariffs."
Well, for 90 days they may be, though little has been heard from the Chinese yet. It's true Trump has not had to concede the tariffs he has already imposed, but China has shown how effectively it can retaliate, and no doubt will do so if no permanent settlement is reached after 90 days.
In the interim, according to the White House, the two sides will begin negotiations on the issues of genuine concern to the US and to all traders with China — forced technology transfers, copyright enforcement, non-tariff barriers to imports, cyber intrusions and cyber theft. China's Foreign Minister Wang Yi said the leaders have agreed to further talks that could lead to a resolution of "legitimate" US concerns.
Most of those issues should be resolved by improved World Trade Organisation rules, as the G20 discussed, but Trump will probably prefer to put an America First stamp on the outcome, as he did when Nafta was renegotiated with Mexico and Canada to be the USMCA.
Whatever he calls an agreement with China, if it does little more than restore trade between the world's two largest markets to what it was before this trade war, it would be progress.