China said it would exclude 16 categories of products from retaliatory tariffs beginning next week ahead of talks to resolve the U.S. China trade war that has proven a drag on both countries’ economies.

The year-long exemptions kick in Tuesday as low-level trade talks get underway ahead of high-level meetings in October.

“China wants to claim the moral high ground before the October talks and to send a message of goodwill,” sYao Xinchao, professor of international trade at the University of International Business and Economics in Beijing, told the Washington Post. “It’s all about molding public opinion”

The U.S. imposed 25% tariffs on some 5,000 Chinese exports representing $550 billion in trade in a bid to win concessions on intellectual property and open markets. President Trump, who has threatened to raise those tariffs to 30%, has long held that trade wars “are easy to win” but talks with Beijing have proved more complicated than he anticipated.

The exemptions include such items as lubricants, fish meal and cancer drugs but notably do not apply to agricultural products like soybeans and pork or manufactured goods.

"Chinese tariffs that really matter are the ones on US agricultural and manufacturing goods, produced mainly in states with strong support for [President] Donald Trump," Artur Baluszynski, head of research at Henderson Rowe, told CNN Business. "We just don't see China willing to negotiate on them before the race for US presidential elections really kicks off."

The Chinese economy is in a major slump. Exports fell an unexpected 1 percent in August while imports were off 5.6 percent despite a 3.8% depreciation of the yuan. Exports to the U.S. were off 16% while imports were off 22%.

Late last week, China’s central bank announced cuts in the amount of cash banks must hold in reserve to free up money for investment.

In a commentary, the state-run Xinhua news agency said Wednesday’s action was taken to ease the impact of tariffs on Chinese enterprises.

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