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Phase 1 Trade Deal Agreement

The government acknowledges that the agreement has not resolved some U.S. complaints, particularly the way the Chinese government subsidizes its businesses. That was the concern expressed when Trump sparked a trade war in July 2018 by imposing tariffs on Chinese imports. 7. See US Trade Representative and US Department of Agriculture, Interim Report on the Economic and Trade Agreement between the United States of America and the People`s Republic of China: Agriculture Trade, October 23, 2020. This report contains data on projected U.S. exports – not actual U.S. exports under the legal text of the trade agreement – based on weekly sales data for certain agricultural products reported to the Department of Agriculture. The United States and China must resume negotiations on important policies that are not affected by the first phase agreement. Trump`s trade war has failed to address what really concerns U.S.-China trade relations. It is time for a new approach. The 86-sided agreement facilitates criminal prosecution in China against those accused of stealing trade secrets.

It contains provisions to prevent Chinese government officials from applying administrative and regulatory procedures to remove the trade secrets of foreign companies and to allow such information to end up in the hands of Chinese competitors. Under the agreement, China will “ensure” that additional purchases of U.S. agricultural products are made of $32 billion over two years, including $12.5 billion above the corresponding 2017 underlying of $24 billion in 2020 and $19.5 billion above the underlying in 2021. Tariffs imposed by the United States and China on imports from each other have decimated bilateral trade in 2018 and 2019. The Trump administration negotiated the legal text of the Phase 1 agreement to force China to buy an additional $200 billion of U.S. goods and services in addition to 2017 (not 2019) if bilateral trade was more robust.2 The legal evaluation of the agreement therefore requires a comparison of 2020 with 2017. The Chinese delegation also welcomed the pact. In a letter to Trump, Chinese President Xi Jinping said the first phase agreement was “good for China, for the United States and for the world.” He said he also showed that the two countries were capable of “acting on the basis of equality and mutual respect.” The letter was read by Beijing`s chief negotiator, Vice Premier Liu He. On January 15, 2020, the United States and China signed a historic and binding agreement on a Phase 1 trade agreement. The agreement requires structural reforms and other changes to China`s economic and trade regime.