China-US Phase One Trade Deal: Deep Seated Crisis Unresolved

The China-US Phase One Trade Deal: Deep Seated Crisis Unresolved (Source

Under terms of the deal, “China will increase imports of US agricultural products, and the US will gradually eliminate its tariffs on Chinese goods,” the People’s Daily explained, adding: “The deal covers intellectual property rights, technology transfers, food and agricultural products, financial services, exchange rates and transparency.” According to China Center for International Economic Exchanges vice president Wei Jianguo, both countries will likely “step on each other’s feet” ahead, but further dialogue will follow the agreement reached. The official Xinhua news agency said the phase one deal is only “a good start” in a dispute that’s “longterm, complicated and arduous.” According to academic Wang Heng, phase two negotiations “may involve more difficult domestic regulatory issues such as subsidies, state-owned enterprises, and internet supervision,” adding: “Due to the complexity of the negotiations, it remains to be seen whether the two parties can reach a second-stage agreement.”

“If market competition rules such as subsidies are not agreed upon, economic and trade frictions may continue and affect the two countries and the international economy.” The US and China recognized the importance of establishing a legal system to protect intellectual property. Both countries agreed not to engage in competitive currency devaluation. US-based Public Citizen’s Global Trade Watch is skeptical about how Sino/US trade will play out ahead, tweeting: “Trump believes his phase one #China deal will yield great benefits for US farmers, producers and other exporters. But his deal may not amount to more than a hill of soybeans.” What’s officially called “fully enforceable” may not turn out as expected. The US and China are rivals, not partners. Growing prominence of other nations on the world stage conflicts with US geopolitical aims. Its rage to dominate other nations, fueling distrust in Beijing and elsewhere, may be the greatest obstacle in the way of resolving major differences ahead. Despite agreement on a phase one deal, major irreconcilable differences between both countries may remain unresolvable no matter how many more rounds of talks are held.

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