US-China Trade Deal
Trade relations between the US and China finally appear
to be heading in a positive direction as the Trump
administration reversed its move to officially designate
Beijing as a currency manipulator. This is one of several measures
taken by both sides just days before they sign what has been dubbed
the “phase one” of a new trade deal.
According to this agreement, China will buy more agricultural
goods – up to $ 40 billion per year from the previous high of $ 27
billion – and crack down on intellectual property thefts. The $ 40
billion figure has been a key point from President Trump’s side as
he has promised this boost to his voters from the farming industry,
but experts question whether China can actually manage to import
these vast sums without oversupplying its markets.
Intellectual property rights have taken centre stage as both
countries compete for supremacy in the international technologi
cal market. Advancements in Artificial Intelligence and 5G and
their strategic capabilities entails that the US wants the ability to
be able to raise its grievances against China in the event of any
perceived misconduct. Having said that, this clause in the trade
deal has also been touted by many as too weak from the US per
spective, which questions
bilateral trade relationship.
itive internationally.
trading rivals lasts.
exactly what progress
the Trump
Administration really made in its efforts to get ‘more’ out of this
For China, the boon will be seeing the tariffs currently imposed
by the US cut to half, alongside an agreement to not impose any
additional import taxes. Whether both sides manage to hold up
their end of the bargain remains to be seen the deal isn’t really
enforceable in any way but the reception to this treaty has been pos
This is an end or at least a pause to the trade war, which has
been ongoing since 2018. Global markets will not have to consis
tently manage expectations and look to anticipate how either coun
try will retaliate. We can only hope that this peace between the two