NEW YORK -- U.S. President Donald Trump on Sunday evening announced that trade talks with China had made enough headway over the weekend to justify delaying a planned tariff increase that would have kicked in after March 1.
In a series of tweets, Trump wrote that the U.S. had made "substantial progress" in the negotiations with China, which have covered "intellectual property protection, technology transfer, agriculture, services, currency, and many other issues."
"As a result of these very productive talks, I will be delaying the U.S. increase in tariffs now scheduled for March 1," Trump wrote.
He concluded the tweets by writing that, assuming both sides make additional progress, "we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for U.S. & China!"
Later that night, Trump told U.S. governors at the White House that he wants to strike a mutually beneficial deal and that there could be "very big news over the next week or two" if the talks continue to go well, Reuters reported. China's official Xinhua News Agency also said the two sides had made "substantial progress" on specific issues, citing the Chinese delegation.
Asian markets reacted favorably, nearly across the board. The Shanghai Composite Index rose 2.3% on Monday morning, to 2,870, with investors taking Trump's comments as a good sign for Chinese companies. The yuan also rose to 6.6768 per dollar in onshore unit trading, the strongest level since last July. Tokyo's Nikkei Stock Average inched up 0.7%, to 21,590.
Trump's decision to extend the deadline came after six days of trade discussions in Washington -- first at the working level and later upgraded to cabinet level -- with the American side headed by U.S. Trade Representative Robert Lighthizer and the Chinese by Vice Premier Liu He.
Liu was invited to the White House to meet Trump on Friday, by which time a deal had been reached on currency -- with China promising to stabilize the yuan -- and increased purchases of U.S. goods.
But the two sides were apparently still divided over structural issues as well as measures to ensure the promises would be kept and enforced.
Trump's Sunday tweets suggested structural issues such as intellectual property protection and forced technology transfers had been addressed, but he did not mention China's subsidies to companies, especially state-owned enterprises, which the U.S. sees as distorting market principles.
At the Friday meeting with Liu, Trump publicly criticized his own chief trade envoy Lighthizer for pursuing a memorandum of understanding, calling it a "waste of time" and arguing that only a trade agreement would hold any weight.
Trump's extension of the March 1 deadline means the scheduled increase in tariffs to 25% from 10% on $200 billion worth of Chinese imports into the U.S. will be put on hold.
But some observers remain cautious. "The postponement in new tariffs should only be welcome if China has made major concessions on structural reforms," said Scott Kennedy of the Center for Strategic and International Studies. "If tariffs are lifted without major reforms, then the trade war would have been carried out in vain, and we would be in a worse position than had we done absolutely nothing," he said.
"President Trump has one month left to prove that this was all worth it and not just a cheap circus."
Nikkei staff writer Akihide Anzai in Tokyo and Taisei Hoyama in Washington contributed to this report.