Trade deals to enhance Sino-US ties
Nations pursuing pragmatic approach to balance economic relationship
China and the US are expected to head toward a stable and cooperative relationship with a Friday joint announcement of deals on bilateral trade expansion and financial services cooperation between the two countries.
Those deals, which cover 10 areas, were the first tangible results of a 100-day action plan announced last month during a meeting between Chinese President Xi Jinping and US President Donald Trump.
China will lift its ban on imports of beef from the US no later than July 16, while the US will issue a proposed rule on allowing the import of cooked poultry from China, according to a joint statement issued on Friday. China banned imports of US beef in 2003 after a mad-cow case in the US.
Meanwhile, the US will export liquid natural gas to China and treats China no less favorable than other non-FTA trade partners.
As of April 25, the US Department of Energy had authorized 19.2 billion cubic feet of natural gas exports per day to non-FTA countries, according to a release posted on the US Department of Commerce on Friday.
Those agreements on trade expansion indicate that China and the US are pursuing pragmatic cooperation and methods to balance the trade structure between the two countries, said experts.
“The agreements will result in reduction in the US trade deficit with China,” Chen Fengying, an expert at the China Institutes of Contemporary International Relations, told the Global Times.
China’s trade surplus with the US reached 489.2 billion yuan ($70.9 billion) in the first four months of the year, latest customs data showed.
China does not deliberately pursue a trade surplus with the US, Yu Jianhua, vice minister of commerce, told a press conference following the announcement of the deal with the US.
Wang Jun, deputy director of the Department of Information at the China Center for International Economic Exchanges, doesn’t think the increase of market access for US agricultural exports will impact China’s domestic farmers and industries. “The Chinese agricultural consumption is very large. And the imports of foreign products can meet middle-class demand for diversified goods,” said Wang.
Take beef imports as an example. The Chinese mainland, alone, is the world’s secondlargest beef and veal importer after the US, with the imports last year rising 22.5 percent year-on-year to 812,000 metric tons, data from the US Department of Agriculture showed in April.
China will allow wholly foreign-owned financial services firms to provide credit ratings by mid-July. In December 2016, China’s Ministry of Commerce proposed draft regulations to open up that market.
US-owned suppliers of electronic payment services will be granted “full and prompt market access” by China, which domestic experts said will bring some challenges to China’s domestic mobile payment companies.
Still, the pros outweigh the cons, as the introduction of advanced US financial firms can facilitate the deepening of the reform of China’s financial system, said Wang.
Moreover, Chinese banks will be treated the same as other foreign banks by the US under the agreement, while China will issue bond underwriting and settlement licenses to two qualified US financial institutions. The two countries also announced other agreements in cooked poultry, crossborder clearing, and biotechnology and settlement licenses.