Donald Trump is poised to announce a $16bn aid package for farmers to compensate them for losses due to the escalating US trade war with China, senior US agriculture department officials said on Thursday.
The bailout marks the second multibillion-dollar move by the US president to help farmers in as many years, as he tries to contain the damage from retaliatory tariffs imposed by China during the commercial conflict, which have sharply reduced US exports to the Chinese market.
“While the farmers would rather have trade than aid, if they don’t have trade they need aid, and that’s what it is,” Sonny Perdue, the US agriculture secretary, said.
US officials said the package was composed of direct payments to farmers worth $14.5bn, as well as $1.4bn in government purchases of agricultural goods to be distributed to food banks and impoverished Americans. Mr Trump said earlier this month that he wanted to direct farm purchases to poor countries as food aid in the package, but that option was discarded.
US officials said the payments would be made in three tranches — with the first coming in July and August. Mr Perdue said it was unlikely that a deal to end the trade war would happen before then, even with a meeting expected between Mr Trump and Xi Jinping, the Chinese president, at the G20 leaders’ summit next month in Japan.
“While we would love a trade deal in that period of time . . . it’ll be very difficult to understand how a trade deal could be consummated prior to that first payment, or first tranche there,” Mr Perdue said, adding that the second disbursement, expected in November or December, and the third payment, would be dependent on the trade talks.