Updated December 14, 2019 08:28:05

Photo: The agreement covers intellectual property, technology transfer, agriculture, financial services, currency, and foreign exchange. (AP: Susan Walsh)

The United States and China have agreed to a "phase one" trade deal that includes cutting tariffs on Chinese goods, according to US President Donald Trump.

"We have agreed to a very large phase one deal with China," Mr Trump said on Twitter.

Officials in China have "agreed to many structural changes and massive purchases of agricultural product, energy and manufactured goods, plus much more," he said.

The US has agreed to suspend tariffs on $US160 billion ($233 billion) in Chinese goods which were due to go into effect on December 15, Mr Trump said.

The agreement covers intellectual property, technology transfer, agriculture, financial services, currency, and foreign exchange, the United States Trade Representative said in a statement.

The United States will maintain 25 per cent tariffs on $US250 billion of Chinese imports, but cut tariffs in half to 7.5 per cent on $US120 billion in imports, the USTR said.

In a press conference in Beijing, Chinese officials said the two countries have achieved major progress in their phase one trade negotiations, and agreed on the text of a deal.

China will import more US wheat and corn after the deal, China's Vice-Agricultural Minister said.

Second phase to start immediately

The US has been pushing for China to commit to buy $US50 billion in agricultural products in 2020, a figure that Chinese officials have previously balked at.

The US has now declared China is a "currency manipulator" — but what does that mean and what effect will it have on the trade war?

Asked specifically about the $US50 billion figure, officials in Beijing said details on value will be disclosed later, but Mr Trump told reporters in a White House conference that China will likely hit that figure.

Mr Trump said his administration would leverage the remaining US tariffs on imported Chinese goods as it seeks to negotiate a phase two trade deal with Beijing.

He added that China wanted to start talks on the deal's second phase right away, a timeline he said he supported.

Washington and Beijing announced the tariff rollback weeks after both sides in October said they had reached an agreement on the "phase one" trade deal.

The deal will provide more protection for foreign companies in China, and Chinese companies in the United States, officials in Beijing said.

ABC/wires

Topics: world-politics, government-and-politics, trade, business-economics-and-finance, international-aid-and-trade, donald-trump, united-states, china

First posted December 14, 2019 08:24:53