China, November 12, 2014: At the Asia-Pacific Economic Cooperation summit in Beijing, US and China signed agreements aimed at defusing tensions over international trade between the two countries.
Chinese and American trade negotiators have agreed to eliminate tariffs on $US1 trillion ($1.15 trillion) a year of global sales of information and communications technology which includes semiconductors, medical equipment, GPS devices, video game consoles and computer software.
The current tariff system adds as much as 25% to the cost of American high-tech products. It has been in place for nearly 18 years and now applies to more than $4 trillion in annual global trade. Under the new agreement, tariffs levied on semiconductors would be reduced to zero from the existing 25%. Tariffs on GPS devices would also be reduced to zero from the existing 8%.
The agreement would be put forth the members of the World Trade Organisation for approval. If more than 52 nations nod in approval, this would be the first major WTO agreement since 1996. The deal would benefit US companies seeking greater access to China as well as US and Chinese companies with plants in China aimed at making products for the American market.
Source: White House