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Hopes of a US/China trade deal have grown even stronger over the weekend. This comes in response to reports that the US has moderated some of its more stringent demands.
The US had been demanding that China cap its industrial subsidies as a requisite for agreeing on a deal. However, following strong opposition from Beijing, the Trump administration has since watered down these demands.
Industrial Subsidies In Focus
The issue of industrial subsidies is a complex one. And it’s highly important to Beijing, as it involves China’s official industrial policy. Beijing awards subsidies and tax breaks to state-owned corporates, as well as sectors, which are seen as integral to long-term development.
Over his term as premier, Xi Jinping has strengthened the government’s role in certain sections of the economy. China gave assurances earlier in the year that it would cease its market-distorting subsidies for domestic industries. However, it gave no details on how it would do so.
US Makes C...
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