US plans to talk to China on ‘shortfalls’ in 2020 trade deal
WASHINGTON: The Biden administration on Monday signalled the resumption of US-China trade talks.
Katherine Tai, the top American trade official, said she plans to have “frank conversations” with her Chinese counterpart about “shortfalls” in Beijing meeting its commitments under Phase One agreement signed with the Trump administration in 2020.
US trade representative Tai also made it clear these talks were not intended to “inflame trade tensions” but America will be prepared and willing to “use the full range of tools we have, and develop new tools as needed to defend American economic interests from harmful policies and practices”.
The resumption of trade talks comes as part of a new strategy based on a review of the bilateral trade relationship and the agreement that was signed by then president Donald Trump and Chinese negotiators in January 2020 that ended months of tensions accompanied by an escalating tariff war between the world’s two largest economies.
“I intend to have frank conversations with my counterpart in China that will include discussion over China’s performance under the Phase One agreement. We will also directly engage with China on its industrial policies,” Tai said in a widely anticipated speech at the Center for Strategic and International Studies (CSIS), a leading US think-tank.
Tai did not detail the “shortfalls” but indicated they may be in the commitments China made to purchase at least $200 billion of US goods and services over two years of the signing of the agreement.
She also did not say when she expects to hold these conversations, except that they will be “soon”.
Apart from buying $200 billion worth of goods and services above the 2017 levels, the pact included stronger legal protections for patents, trademarks, copyrights, including improved criminal and civil procedures to combat online infringement, pirated and counterfeit goods; and pledge to desist from competitive currency manipulations.
Tai said the 2020 agreement stabilised the market, especially for US agricultural exports, but “our analysis indicates that while commitments in certain areas have been met, there have also been shortfalls in others”.
According to the Pietersen Institute for International Economics, a US think tank that runs a tracker of the Phase One deal, China has met only 62% of its purchase commitments for American goods.