China suspends more penalties on U.S. goods after trade truce

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China on Friday suspended more punitive tariffs on imports of U.S. industrial goods in response to a truce in its trade war with Washington, D.C., that threatened global economic growth.

Financial markets have welcomed announcements by both sides of reductions in penalties on each other’s goods, though they have yet to resolve much of the conflict that erupted in 2018 over Beijing’s technology ambitions and trade surplus.

Goods affected by the latest reduction include industrial components and medical and factory equipment, according to the Finance Ministry. It gave no details of the value of goods affected but said penalties were suspended for one year, effective Feb. 28.

The cuts come as China struggles with the mounting cost of measures imposed to contain a virus outbreak that has closed factories, stores and other businesses.

Under their “Phase 1” agreement signed in January, Washington agreed to cancel additional tariff hikes and Beijing committed to buy more American farm exports. U.S. officials said China also committed to addressing complaints about its technology policies.

Last week, the Trump administration reduced penalties on some Chinese imports.

In an earlier tariff cut, China announced Feb. 6 it would reduce duties on $75 billion of U.S. goods as part of a trade truce with Washington.

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