Last Friday the United States and China announced they had reached an agreement on a preliminary trade deal. The “phase one” deal averted U.S. tariffs planned to take effect last Sunday on Chinese imports totaling $160 billion. The U.S. will maintain 25 percent tariffs on approximately $250 billion worth of Chinese imports, but will reduce tariffs to 7.5 percent on the remaining $120 billion of Chinese imports.
According to U.S. Trade Representative Robert Lighthizer, China agreed to increase its purchases of U.S. farm products to $32 billion over two years, while total exports of food, energy, manufactured goods and services to China will increase by a total of $200 billion. Officials also say the deal includes stronger Chinese legal protections for patents, trademarks, and copyrights.
Chinese officials have not publicly confirmed these commitments, but said it will import more wheat, rice, corn, energy, pharmaceuticals and financial services. Lighthizer said he expects the deal will be signed in January and take effect 30 days later. Negotiations will continue immediately to discuss phase two.
While key details remain unclear, some experts are underwhelmed by the deal. Scott Kennedy, an expert on the Chinese economy at the Center for Strategic and International Studies, told TheWashington Post, “If it’s what I think it is, it’s not even close to worth it.” According to Evan S. Medeiros, former Asia director at the National Security Council under President Barack Obama, Chinese agricultural purchases was the only thing of substance negotiated and was shallow compared with President Donald Trump’s promises.
