If you followed Donald Trump’s presidential campaign, you know that he talked tough on trade – especially when it came to countries he believed were giving the U.S. a raw deal. He pledged to either kill or renegotiate existing trade deals like the North American Free Trade Agreement.

He saved some of his harshest words for China. At one point during the campaign, candidate Trump declared that “we already have a trade war” with China and vowed to slap tariffs on Chinese products and label the Asian giant as a currency manipulator.

So the escalation in what appeared to be a brewing trade war over the last couple of weeks – with President Trump threatening to slap $150 billion in tariffs on China, and Chinese leaders proposing another $50 billion on products like soybeans, pork and nuts - understandably had farmers and financial markets on edge.

But on Tuesday, Chinese President Xi Jinping appeared to be stepping back from the brink and addressing some of Trump’s demands – albeit in a way that Chinese media portrayed as previously planned “next steps” in the country’s ongoing economic reforms.

In his keynote speech at the Boao Forum for Asia, Xi did not mention the U.S. or Trump. However, he pledged to open China’s doors “wider and wider” to the world. Xi said that China was not seeking to run a trade surplus, and he announced plans for the easing of foreign ownership limits in the financial and automotive industries. He said China would “significantly lower” tariffs on imported cars this year. Currently, China charges total duties of 25 percent on most imported cars.

Xi also said China will step up enforcement of intellectual property rights protection and significantly raise the cost for offenders.

"We encourage normal technological exchanges and cooperation between Chinese and foreign enterprises, and protect the lawful IPR owned by foreign enterprises in China," he said.

A few hours after Xi’s speech, Trump praised the comments in a tweet:


While Xi’s comments seemed to temporarily calm a lot of nerves, analysts pointed out that this is not the first time that China has made promises to open up its economy – and not delivered. So, there was plenty of speculation that this was just another tactic to further delay actual changes.

For example, the Chinese government promised last November to "gradually and properly" reduce tariffs on imported vehicles.

"President Xi's remarks do not represent a dramatic departure from existing Chinese policy, but rather a reiteration of the same themes Xi has promoted throughout his tenure atop China's policy making system," said Chaoping Zhu, global market strategist at JP Morgan Asset Management, in an interview with CNN Money.

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