BUSINESS US-China phase-one trade deal underpins positive market sentiment: expert


US-China phase-one trade deal underpins positive market sentiment: expert


19:54, December 16, 2019

WELLINGTON, Dec. 16 (Xinhua) - The phase-one economic and trade deal between the United States and China is a step in the right direction, underpinning market sentiment and boosting world trade, Wayne Huang, principal of the Institute of Commercial Education New Zealand, told Xinhua in an interview on Monday.


(File photo)

Capital markets across the world, as a barometer of the macro economy, were "up in an immediate response to the news recently," Huang said as he commented on the "substantial progress" China and the United States have achieved in their latest round of trade talks.

China and the United States have agreed on the wording of a phase-one economic and trade agreement based on the principles of equality and mutual respect, according to a statement issued by the Chinese side Friday.

Trade frictions between the world's two largest economies have severely hurt both businesses and ordinary people from China and the United States, in addition to impacting the global economy, he said.

According to the International Monetary Fund's latest World Economic Outlook report, global growth is forecast at 3 percent for 2019, its lowest level since 2008. It is a 0.3 percentage point downgrade from projections in April, in part due to the uncertainty caused by the China-US trade war.

New Zealand has also been influenced, said Huang, given its close trade ties with China.

Huang noted that the higher tariffs and prolonged trade uncertainty have damaged investment for capital goods, causing market turmoil and lower productivity due to supply chain disruptions.

He stressed that China's development in the past four decades has contributed to the growth and stability of the world economy.

"The practice in the past 40 years proves that China's peaceful development is not a threat to the world, but an anchor of stability and a driving force for growth," Huang said. 

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