President Trump and Chinese Vice Premier Liu He plan to sign a phase one trade agreement of a U.S. trade deal on Wednesday, after nearly 18 months of a simmering tariff war.
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The deal is the first step toward a more comprehensive trade agreement between the world's largest economies and has been in the works since October.
“On Jan. 15 we’re signing a monster — a big, beautiful, monster,” Trump said at a campaign rally in Toledo, Ohio, Thursday night, referring to the deal. "As we begin the new year, our economy is booming."
Here's everything you need should know about the partial deal:
1. China is expected to purchase $200 billion in U.S. products
In December, Beijing agreed to purchase $200 billion worth of U.S. goods over the next two years. Trump has touted the prospect of China buying $40 billion to $50 billion on American agricultural products. China has never purchased more than $26 billion worth of agricultural goods from the U.S. in a single year, according to Reuters.
2. The U.S. will reduce tariffs on China
The U.S. agreed to reduce tariffs on Chinese products, though it is expected to keep tariffs on about $380 billion in goods.
The trade war began in 2018 when Trump tried to crack down on what he viewed as unfair trade practices, or what Trump trade adviser Peter Navarro once called China's "seven deadly sins": intellectual property theft, forced technology transfers, cyberattacks, product dumping, subsidized state-owned enterprises and subsidies, selling fentanyl to the U.S. and currency manipulation.
3. Text from the Phase One deal is expected to be posted online
A U.S. trade source told FOX Business that the phase one trade text will be posted online on the U.S. Trade Representative website the "moment" the agreement is signed on Wednesday.
4. There will be a dinner the night before the signing ceremony
U.S. and Chinese trade officials are expected to gather for a dinner the night before the signing ceremony and a lunch the next day after the agreement is signed.
5. A full U.S.-China trade agreement could come in several more phases
The president has previously suggested that a complete trade deal could involve two or three phrases.
"At a later date I will be going to Beijing where talks will begin on Phase Two!" Trump wrote on Twitter at the end of 2019.
Although Trump previously suggested the second phase could come immediately after the first, he does not have any imminent plans to visit China for further trade talks, sources told FOX Business.
6. Farmers and manufacturers are optimistic
"For farmers, this could either be the first ray of hope or another empty promise," Brian Kuehl, co-executive director of the free-trade organization Farmers for Free Trade, said in a December statement. "Farmers want sustained access to China’s market, not one-time purchases, so it will be critical to see how the retaliatory tariffs that have crippled farm exports are treated in this agreement."
Kuehl also told FOX Business in December that he was skeptical about the second phase of a deal coming so soon after the first.
"We'll believe it when we see it," Kuehl said. ]
Even then, a $50 billion agreement wouldn't make up for everything farmers have lost within the last two years, because China was buying about $26 billion in agricultural goods before the trade war began in 2017, he said.
7. What comes next?
Both countries plan to hold semiannual meetings headed by Liu and Treasury Secretary Steven Mnuchin to resolve disputes, The Wall Street Journal reported Saturday.
A senior administration official told the Journal the meetings would be "very different" from trade negotiation talks and will be separated from discussions regarding a phase two deal.