Morning Briefing: Waiting for US-China Trade Talks Result

Top Chinese and US Envoys Meet in China to Discuss Next Step in Trade War Talks - Photo by SMCP

JAKARTA (TheInsiderStories) — United States (US) and China will have another round talk, as an attempt to end the trade war. Chinese Vice Premier Liu He just arrived in Washington, and will meet US Trade Representative Robert Lighthizer. The discussion will be held for two days, starting tomorrow.

The trade talk will focus on how many American soybeans China buys to the subsidies Beijing gives its state-owned companies. If the discussion failed, President Donald Trump threatened to raise tariff on US$200 billion of Chinese imports from 10 percent to 25 percent, as US-China’ 90 days trade truce will end on March 1.

Even Lighthizer and Liu reach an agreement this week, its probably take time the two presidents, Trump and Chinese President Xi Jinping to decide. For the best-case scenario, China will offer on economic reforms that’s more ambitious than expected. But for the worst-case scenario, there’ll be no statement at the conclusion of talks.

Both economic superpowers trade wars has given dark clouds on global economy. So the world holds high expectation on the US-China trade peace.

In Indonesia, Rupiah against US Dollar gained a good sentiment ahead of US-China trade talks. Unlike Rupiah, Jakarta Composite Index closed weakening by 0.37 percent to 6,458.71. Foreign recorded net sell for Rp660.99 billion. Basic industry and chemical sector led highest increase, followed by agriculture sector.

While, Indonesian government planned to sue European Union‘ (EU) Renewable Energy Directive II to World Trade Organization’s Dispute Settlement Body, as stated by Foreign Ministry. Indonesia will sue after the policy release on February 1, and review several cooperation with the EU, along with ASEAN countries.

EU Renewable Energy Directive II covers renewable energy production and promotion policy in 2020-2030. As a supporting act, the organization will soon issue a delegated act which categorizes plants based on risks. High risk plants usage will be limited and removed from EU fuel in stages. Palm oil is considered as a high risk plant in the policy.

Furthermore, Indonesia Trade Ministry still imposes 0 percent on crude palm oil (CPO) export tariff, as the price is still lower than $570/metric ton. Meanwhile, CPO price is determined at $575.4 a metric ton in February, 12 percent higher than January’ price. Government will impose $25/metric ton, if the CPO price range is around $570-619/metric ton.

Taxi operator, PT Blue Bird Tbk (IDX: BIRD) set up a joint venture company (JVC) in the auction field with Japan’ Mitsubishi UFJ Lease & Finance Co. Ltd. and local firm PT Takari Kokoh Sejahtera on Jan. 24. The third parties inject Rp23 billion ($1.63 million) in the new JVC, PT Balai Lelang Caready.

May you have a profitable day!

US$1: Rp14,100
Written by Linda Silaen and TIS Intelligence Team, Please visit our website to get more insight on Indonesia’s economy