Business & Investment

China still hasn’t reached an arrangement to reduce the U.S. trade surplus

On July 9, 2007, the US and Chinese flags were waved outside a commercial building in Beijing.

Teh Eng Koon | AFP | Getty Images

Beijing — Despite a surge in overall Chinese imports from the United States, China’s purchases of US products are still below trade agreement levels.

This is from an analysis conducted Monday by the US-based Peterson Institute for International Economics.

In January 2020, before the coronavirus pandemic, under former US President Donald Trump China has agreed to buy at least $ 200 billion With US goods and services over the next two years compared to 2017 levels. The purchase agreement, known as the Phase 1 Trade Agreement, included certain agricultural, energy and manufactured products.

However, as of June, data from China and the U.S. government show that China has purchased less than 70% of its year-to-date target, according to estimates by senior researcher at the Peterson Institute for International Economics, Chad P. Bawn. Is shown.

Agricultural purchases were again closest to the consensus level, at 90% of the target, according to US data quoted by Bown.

According to Chinese customs data, this shortage will occur as trade between the two countries expands.

China’s imports from the United States increased to $ 87.94 billion in the first half of this year, up 55.5% from the same period in 2020 and nearly 49.3% from the first half of 2019.

Meanwhile, China exported $ 252,860 million worth of goods to the United States in the first half of 2021. This was an increase of 42.6% from the same period in 2020 and an increase of 26.8% from the first half of 2019.

As a result, the United States remains China’s largest trading partner on a single-country basis, despite intensifying trade tensions under the Trump administration.

Stagnation US-China trade negotiations

Over the past few years, under the Trump administration, the United States has imposed tariffs on billions of dollars worth of Chinese goods to address long-standing complaints about issues such as lack of market access and intellectual property protection. Beijing responded with its own obligations to US goods.

Since taking office in January, President Joe Biden has maintained and announced Trump-era tariffs and sanctions on major Chinese tech companies such as Huawei. Additional sanctions on Chinese entities..

But Biden “has not yet clarified a truly effective trade strategy or alternative approach to countering China’s economic strength,” said Michael Harson, Eurasia Group’s head of operations for China and Northeast Asia, Monday. To CNBC’s “Squawbox Asia.. “

During ~ High-level meeting between officials from both countries China’s Foreign Minister Wang Yi said on Monday that the United States should eliminate tariffs as part of three broader requests from China.

In a meeting with reporters about a meeting with Chinese officials with the Deputy Secretary of State, senior U.S. government officials did not mention tariffs. Rather, US officials said Sherman had raised concerns about unfair trade and economic practices.

Read more about China from CNBC Pro

The Phase 1 trade agreement called for a review of the deal, but due to the coronavirus pandemic and changes in White House leadership, the meeting has not yet taken place.

According to the Peterson Institute for International Economics, in the first year of the Phase 1 trade agreement, in 2020, China’s purchases were less than 60% of the target, based on data from both countries.

China’s trade surplus with the United States, which Trump tried to cut, remained close to a record $ 32.58 billion in June, according to customs data.

At a press conference in mid-July, Commerce spokesman Gao Feng refused to confirm whether the Phase 1 agreement was still in place.

Instead, according to CNBC’s translation of his Mandarin remarks, China has always encouraged both sides to “work together to create an atmosphere and conditions for implementing the agreement.”

— CNBC’s Yen Nee Lee contributed to this report.

China still hasn’t reached an arrangement to reduce the U.S. trade surplus China still hasn’t reached an arrangement to reduce the U.S. trade surplus

Back to top button