February 24, 2020

U.S. Says China On Track To Meet Obligations Under Phase One Trade Agreement

The coronavirus outbreak in China has caused some speculation over the last few weeks that the Chinese government will not uphold promises it made under the limited, phase one trade agreement hammered out with the United States earlier this year.

The Trump administration last week largely dismissed those concerns and, according to Politico, said talks about implementing the deal “are proceeding as scheduled.” Michael Ward, the senior U.S. agricultural attaché at the U.S. Embassy in Beijing, said China has not asked to delay work, nor has the coronavirus had a noticeable impact on the availability of Chinese government officials.

To that end, as Reuters reported last week the Chinese government announced that it will grant exemptions on retaliatory duties that it had imposed against 696 U.S. goods, including copper ore, aluminum scrap, liquefied natural gas and crude oil, ethanol, wheat, corn and sorghum. Argus Media reports, “The new policy extends upon a similar trial program that was launched in May 2019 which allowed Chinese importers to apply for exclusions to import tariffs levied on copper scrap and other recycled metals from the US that went into effect in April 2018 for up to 100 percent of the tariffs. As a result, eligible importers may receive one-year exemptions from the date of approval on the 25 percent tariffs placed on US copper scrap and 50 percent tariffs on aluminum.” The exemptions will start on March 2, 2020.

Despite promises that talks with China remain on course, on social media over the weekend President Donald Trump did acknowledge that China could fall short of its 2020 commitment to buy about $40 billion worth of U.S. farm goods.