Beef­ing up trade

China and US reach agree­ment on meat, poul­try, nat­u­ral gas

The Progress-Index Weekend - - BUSINESS - By Martin Crutsinger and Jill Colvin

WASH­ING­TON — Bei­jing will open its bor­ders to U.S. beef, while cooked Chi­nese poul­try is closer to land­ing on Amer­i­can su­per­mar­ket shelves un­der a U.S.-China trade agree­ment.

Trump ad­min­is­tra­tion of­fi­cials hailed the deal as a sig­nif­i­cant ad­vance to­ward boost­ing U.S. ex­ports and clos­ing Amer­ica’s trade gap with the world’s se­cond-largest econ­omy. U.S. trade ex­perts of­fered a more muted as­sess­ment, call­ing the agree­ment a mod­est ful­fill­ment of past as­sur­ances made by China.

Among other things, the deal en­ables U.S. com­pa­nies to ex­port liq­ue­fied nat­u­ral gas to China. It will also lower long-stand­ing bar­ri­ers that have af­fected mat­ters rang­ing from agri­cul­ture to the op­er­a­tion of Amer­i­can fi­nan­cial firms in China.

Com­merce Sec­re­tary Wil­bur Ross hailed the agree­ment, com­ing on the heels of Pres­i­dent Don­ald Trump’s April meet­ing with Pres­i­dent Xi Jin­ping, as “a her­culean ac­com­plish­ment.”

“This is more than has been done in the whole his­tory of U.S.China re­la­tions on trade,” Ross told re­porters Thurs­day evening at the White House.

In Bei­jing, Vice Fi­nance Min­is­ter Zhu Guangyao told re­porters the early re­sults of the agree­ment showed that eco­nomic col­lab­o­ra­tion be­tween the two sides “couldn’t be closer.”

But trade ex­perts ques­tioned the mag­ni­tude of the deal.

“These are mod­est moves which by them­selves will not have much ef­fect on the U.S. econ­omy,” said David Dol­lar, a se­nior fel­low at the Brook­ings In­sti­tu­tion and for­mer Trea­sury Depart­ment of­fi­cial.

The beef ex­ports and elec­tronic pay­ments in the agree­ment have long been promised by China. And the agree­ment does lit­tle to ad­dress some key is­sues of trade fric­tion, such as au­to­mo­biles or so­cial me­dia. While the Trump ad­min­is­tra­tion has touted a surge in U.S. man­u­fac­tur­ing, this agree­ment does lit­tle to help that goal.

“The chal­lenge is sell­ing man­u­fac­tured goods into China — there isn’t any­thing in this deal to sug­gest China is go­ing to be­come more open to U.S.-man­u­fac­tured ex­ports,” said Brad Setser, a se­nior fel­low at the Coun­cil on For­eign Re­la­tions.

It re­mains un­clear how far China will go to al­low more Amer­i­can ex­ports. Pre­vi­ous ad­min­is­tra­tions have hailed mar­ket-open­ing agree­ments only to be left dis­ap­pointed.

“The key in these ne­go­ti­a­tions is specifics that are en­force­able — lit­er­ally, the devil is in the de­tails,” said Scott Mul­hauser, a for­mer chief of staff at the U.S. Em­bassy in Bei­jing.

“The more these agree­ments in­clude real, con­crete out­comes rather than plat­i­tudes, re­hash­ing old ground or punts to the fu­ture, the bet­ter they are,” Mul­hauser said. “Amer­i­can com­pa­nies, work­ers, farm­ers and more are ea­ger for more ac­cess to Chi­nese mar­kets, and they’ll look to en­sure re­al­ity matches the rhetoric of these prom­ises.”

Trump made Amer­ica’s wide trade deficits and es­pe­cially the gap with China a ma­jor is­sue in his cam­paign and dur­ing the early days of his ad­min­is­tra­tion. He’s ar­gued that Amer­ica’s peren­nial trade gaps have cost mil­lions of fac­tory jobs and he has pledged to take a tougher stance in trade ne­go­ti­a­tions to lower the im­bal­ances.

Un­der the agree­ment, the United States is invit­ing Chi­nese com­pa­nies to im­port U.S.-pro­duced liq­ue­fied nat­u­ral gas. The En­ergy Depart­ment has authorized nat­u­ral gas ship­ments of 19.2 bil­lion cu­bic feet per day to China and other in­ter­ested coun­tries that lack a broader free trade agree­ment with the United States, the Com­merce Depart­ment said.


China’s Vice Fi­nance Min­is­ter Zhu Guangyao speaks dur­ing a news con­fer­ence at the State Coun­cil In­for­ma­tion Of­fice on Fri­day in Bei­jing. China will fi­nally open its bor­ders to U.S. beef while cooked Chi­nese poul­try is closer to hit­ting the Amer­i­can mar­ket as part of a U.S.-China trade agree­ment. Zhu told re­porters that the early re­sults of the agree­ment showed that eco­nomic col­lab­o­ra­tion be­tween the two sides “couldn’t be closer.”

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