China, U.S. make breakthrough on IT free trade deal: U.S. trade representative

(Reuters) - China and the United States have reached a breakthrough in talks on eliminating duties on information technology products, a deal that could pave the way for the first major tariff-cutting agreement at the World Trade Organisation in 17 years.

The breakthrough would allow the "swift conclusion" on talks to expand the Information Technology Agreement (ITA) at the WTO in Geneva later this year, United States Trade Representative Michael Froman told reporters on Tuesday. It would reduce global tariffs on such products as medical equipment, GPS devices, video games consoles and next-generation semiconductors.

"This is encouraging news for the U.S.-China relationship," Froman said on the sidelines of meetings of the Asia-Pacific Economic Summit (APEC) in Beijing.

"It shows how the U.S. and China work together to both advance our bilateral economic agenda but also to support the multilateral trading system."

The ITA, which went into effect in 1997, now covers more than $4 trillion in annual trade, according to the U.S. government. Participants to ITA commit to eliminating tariffs on such items as computers and computer software, telecommunication equipment and other advanced technology products.

An expanded ITA would eliminate tariffs on about $1 trillion worth of global sales on IT products, Froman said. More than 200 tariff lines will be reduced to zero under the new agreement.  Read More