“This “phase one” deal, which the US and China reached in December, will cool trade tensions between two economic superpowers that have rattled the globe.
But it stops short of the comprehensive trade and reform agreement the Trump administration wanted when it launched its trade war with China in 2018.
Instead, China has agreed to make purchases of about $200 billion worth of US goods over a two-year period, including almost doubling its agricultural purchases to $40 billion.
China also made concessions on intellectual property, currency, and access to financial services, and it’s promised to halt the practice of forcing companies to turn over their technology, according to the United States Trade Representative.
The US, in exchange, will call off and reduce some tariffs, though taxes on $360 billion in Chinese goods will stay in place.
President Donald Trump is selling this deal as an enormous win, but the administration did not get the structural changes to China’s economy that it wanted, including tackling things like Beijing’s huge subsidies to Chinese companies. It’s still not clear if China can or will totally fulfill this obligation to buy US products, and even if it does, the guarantee is only for two years.
Given all that, this partial trade deal might not be able to make up for the pain the trade war caused.”
“few experts think such a phase two is possible. It’s much more likely the US settled because this is all it could get out of China — and for Trump, it was worth it to have something he could brag about ahead of the 2020 election.”