US-China commercial tensions will outlast COVID-19
A call last Thursday between Presidents Trump and Xi appears to have brought tensions over the COVID-19 response under control for now. This week, US government officials including Trump have emphasized the importance of bilateral cooperation, which includes the delivery of Chinese medical equipment to the United States this week. USCBC sources indicate officials at all levels have maintained frequent communication. However, immediate...
Amid bilateral tensions and COVID-19 outbreak, US and China make progress on Phase One
US and Chinese officials leading the Bilateral Evaluation and Dispute Resolution Offices, part of the Phase One agreement enforcement mechanism, are expected to hold their first formal call today to discuss implementation of the deal. Assistant United States Trade Representative Terry McCartin will lead the US team, and a deputy general from the Ministry of Finance is expected to lead for China....
Trump invokes wartime authorities to combat coronavirus, still waiting for Buy American EO
The White House announcement invoking the Defense Production Act (DPA) to combat the coronavirus (COVID-19) delegates authority to Health and Human Services to prioritize and allocate existing medical resources, including through contracts with the private sector. It does not include measures to increase supply, like loans, purchase commitments, or subsidies. However, two of the main advocates...
Suspending tariffs may be gaining support due to COVID-19
While some in the administration remain opposed to any tariff cuts, US-China Business Council sources indicate others, including Treasury Secretary Steven Mnuchin and Senior Advisor to the President Jared Kushner, are floating the idea of temporarily removing or rolling back a portion of tariffs as one way to support the economy as the United States assesses the economic toll of COVID-19. A growing number of lawmakers are also...
Export controls conversation moving forward despite Commerce personnel shake-up
The tightening of the direct product and de minimis rules, targeting Huawei, remain on the table despite a key personnel change at the Department of Commerce. On Monday, Commerce Secretary Wilbur Ross announced that Earl Comstock, director of policy and strategic planning, would be stepping down today. It is unclear exactly what prompted the announcement, or who will replace Comstock, but the decision has...
China begins fulfilling Phase One agriculture commitments
This week saw the beginning of concrete steps by China to implement elements of the Phase One agreement, notably the agricultural commitments, which were among the most substantial. On Tuesday, the United States Trade Representative (USTR) Robert Lighthizer and US Secretary of Agriculture Sonny Perdue outlined several actions China has taken to remove or reduce agriculture-related barriers included in Phase One commitments....
Phase One implementation begins
US officials continued to affirm this week that no request from China to delay implementation of the Phase One trade deal had been received, and that it was on track despite concerns about COVID-19. In a move that could pave the way for the increased purchases outlined in the expanding trade chapter of the deal, including agricultural products, China announced a new list of products that will be eligible for tariff exclusions. Yesterday, the United...
Today, the Phase One trade agreement officially goes into effect. While both the US and Chinese governments have repeatedly expressed confidence in China’s commitment to fulfilling the agreement, how China will complete the $200 billion worth of purchases of US products remains a question. The novel coronavirus (COVID-19) outbreak which China continues to grapple with also raises fresh questions. The Chinese government this week conceded that the virus may cause some...
Coronavirus, so far, not expected to impact purchase commitments
Yesterday, President Trump spoke with China’s President Xi Jinping about the novel coronavirus and “agreed to continue extensive communication and cooperation between both sides,” according to the White House readout. Though the leaders also reportedly affirmed their commitment to implement the recent Phase One trade agreement, the impact of the virus on China’s economy has raised concerns about...
Several questions remain about the implementation of the Phase One trade agreement due to come into force on February 14. With little information from US or Chinese officials as to whether tariffs on various goods will be rolled back, there are doubts over the prospects of purchase commitments being met, and questions about the timeframe. Prospects for “phase two” negotiations are also unclear. In conversations with the US-China Business Council,...
