The so call “trade war” between the US and China seems to be coming to an end, with Chinese President Xi Jinping yesterday pledging a “new phase of opening up” , which would include reducing Chinese import tariffs, lowering foreign ownership restrictions, and increasing intellectual property protections in the world’s second largest economy.

The media has had no hesitation in labelling the current trade dispute between China and the US as a “Trade War”, with US president Trump highlighted as the main antagonist. Now I’m personally not the biggest fan of Trump, but the reality is he was seeking to equalise an uneven playing field, with the US generally open to free trade, and with China largely maintaining protectionism.

In Trump’s own words, “we are not in a trade war with China”; “the action is a response to the unfair trade practices of China over the years.”

And it looks to have worked.

President Trump was largely conciliatory in his response to President Xi, but it remains to be seen whether this will lead to a repeal of the tariffs that the Trump administration has already implemented, such as the tariffs on steel and aluminium imports.

To implement these tariffs, President Trump used an old section of legislation that allowed the president to unilaterally implement tariffs based on the recommendation of the secretary of commerce if “an article is being imported into the United States in such quantities or under such circumstances as to threaten or impair the national security”. This is the first time that this mechanism has been used since the creation of the World Trade Organisation in 1995.

Similar tariffs in the past have been to the detriment of the US, and studies have shown that these steel tariffs will likely lead to job losses (estimated at 146,000). Now that China has indicated that it is willing to make concessions, hopefully these tariffs are repealed; or at the very least – no new tariffs are announced.

Equity markets largely applauded the softening of positions, with Chinese, US, and even Australian shares higher over the past 48 hours.