Friday, 8th December, 2023
Friday, 8th December, 2023

China falling short of US trade deal targets

China is falling short of its commitment to buy an extra $200bn (£146bn) worth of US goods over 2020 and 2021.

China agreed to buy the goods in a trade deal with the US agreed last January in exchange for reduced tariffs on $120bn worth of goods.

The agreement was seen as phase one of a deal aimed at resolving the trade war between the world’s biggest economies.

Since the Covid-19 pandemic the US trade deficit with China has surged.

Medical goods and equipment used for the work from home boom helped drive US imports of Chinese goods in 2020.

During this time, China exported nearly three times as much as it imported from the US in December, according to Chinese customs figures.

The January 2020 trade agreement was an attempt to wind back a tit-for-tat trade war which saw both China and the US ratchet up tariffs.

At the time, then-president Donald Trump hailed the deal as “transformative”, and said it would protect American workers.

Under the agreement, the $200bn worth of additional purchases are based on 2017 levels, and only apply to specific categories of goods.

The agreement included agricultural products, manufactured products and energy products.

Analysis by the Peterson Institute estimates that China would need to purchase $173bn worth of goods to meet the requirement.
media caption’I wouldn’t say we’ve started a lot of trade wars’

The latest figures from Chinese customs show that China imported just under $135bn from the US in 2020.

However, about $35bn worth of goods didn’t count under the agreement, meaning China bought about $100bn worth of covered goods.

The figure amounts to 58% of what China committed to under the agreement, according to the Peterson Institute.

China imported 64% of its targets for agricultural products, 60% of its targets for manufactured products and 39% for energy products.

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