Some Relief for American Businesses and Consumers: Phase 1 Agreement Towards Normalizing Trade Relations with China

Today, President Trump signed a partial trade agreement with China. This deal is considered Phase 1 of ongoing trade negotiations between the United States and China.

This deal should ease trade tensions between the two countries and provide much-needed relief to American businesses that have been suffering under the weight of the tit-for-tat tariffs that have been piled on over the past three years. The tumultuous negotiations have upset financial markets, cast uncertainty over business decisions, and hindered economic growth in both nations.

The Phase 1 agreement is most helpful to American workers. It includes important commitments from China, which include expanding market access for American businesses in agriculture, manufacturing, and financial services; strengthening intellectual property protections and enforcement; and addressing unfair technology transfer practices by Chinese corporations and the Chinese government.

In total, China has committed to spending an additional $200 billion in the two years through December 2021 to help close its trade imbalance with the United States: $77.7 billion in purchases of manufactured goods including aircraft, $32 billion in purchases of agricultural products, $52.4 billion in purchases of energy, and $37.9 billion in purchasing services. In addition, the agreement also restricts the Chinese government from manipulating currency to gain a trade advantage and includes enforcement mechanisms to ensure the Chinese keep their promises.

Read the full text of the agreement here: https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rVaHxDBUtdew/v0

When fully implemented, China’s commitments will create a better environment for U.S. exporters and investors and begin the process of rebalancing the economic relationship between the United States and China. 

Much remains to be done in the normalizing trade relations with China.

Immediately following today's signing, we hope China and the United States will begin negotiation on Phase 2 in order to address significant concerns in the areas of subsidies, digital trade and data discrimination, and non-tariff barriers to U.S. manufacturers and service providers.