The Trump administration has suspended its plan to impose tariffs on $150 billion in Chinese imports to the U.S. while trade talks between the two countries continue. The respite is an encouraging sign for the promotional products industry, which could have been in the middle of a potential U.S.-China trade war. Tariffs on imported Chinese goods have the potential to raise the price of promo items sold in North America, as the vast majority of products available here continue to be produced abroad, particularly in China.

“Both parties have agreed to suspend the tariffs,” Treasury Secretary Steven Mnuchin told CNBC on Monday, warning that President Trump “can always put tariffs back on” if the negotiations fall through. In March, Trump fired the first shot by announcing tariffs as part of an investigation into the theft of U.S. intellectual property. China retaliated by announcing tariffs of its own on 106 U.S. products, amounting to roughly $50 billion of American goods annually.

On China, Barriers and Tariffs to come down for first time.

— Donald J. Trump (@realDonaldTrump) May 21, 2018

Mnuchin led the administration's talks with senior Chinese officials in Washington last week. In a joint U.S.-Chinese statement on Saturday, Beijing agreed to "substantially reduce" the U.S. trade deficit with China, a major sticking point in the negotiations. Last year, the U.S. exported $130 billion in American merchandise while it imported $506 billion worth of goods made in China, resulting in a deficit of about $337 billion, The Los Angeles Times reported.

In order to reduce the deficit, the joint statement said, China would expand its purchases of American farm and energy exports. Previously, China had targeted American-produced fruits, pork, wine and other goods as a response to the U.S. levying tariffs on Chinese steel and aluminum.

China has agreed to buy massive amounts of ADDITIONAL Farm/Agricultural Products - would be one of the best things to happen to our farmers in many years!

— Donald J. Trump (@realDonaldTrump) May 21, 2018

Under our potential deal with China, they will purchase from our Great American Farmers practically as much as our Farmers can produce.

— Donald J. Trump (@realDonaldTrump) May 21, 2018

Chinese high technology companies are in Trump’s crosshairs due to investment policies that effectively force U.S. companies to give up their technology secrets in exchange for being allowed to operate in the country. In addition to the tariffs, the Trump administration is also restricting Chinese investment in American technology firms.

Robert Lighthizer, the U.S. trade representative who led the investigation, said that the U.S. had agreed on a framework to address the serious issues identified. “Getting China to open its market to more U.S. exports is significant, but the far more important issues revolve around forced technology transfers, cyber theft and the protection of our innovation,” Lighthizer said in a statement.

Back in March, several industry leaders believed the tariff talk was merely political giants flexing their muscles, issuing threats that wouldn’t have lasting effects. “My guess is that, like the steel tariffs, these tariffs will get dialed back once the dust settles and all the groups lobby for changes,” Larry Cohen, president of Top 40 distributor Axis Promotions (asi/128263), told Counselor. “The tariffs do have the potential to impact prices, but I haven’t seen a breakdown of how they will impact specific products. I don’t think it will cause people to stop buying promotional merchandise, as these items play an integral role in companies’ marketing.”