Trade Agreement Phase One

The agreement stipulates that companies should be able to „operate without any force or pressure from the other party to transfer their technology to people on the other side.” Any transfer of technology or license between people from each country must be voluntary in accordance with the agreement. The two countries also agreed to a provision preventing the government from directing or assisting domestic companies in acquiring foreign technologies that could create „distortions” in sectors and industries. Chinese demand for agricultural imports: the impact of the first phase trade agreement The monetary agreement promises China to refrain from competitive currency devaluations and not to direct its exchange rate towards a trade advantage – a language that China has accepted for years as part of its commitments to the Group of 20 major economies. The agreement provides for increased legal protection for China`s patents, trademarks, copyrights, including improved criminal and civil proceedings to combat online violations, piracy and counterfeiting. Soybeans are a good example of the anti-Trump reaction to trade policy. Before the trade war, they accounted for nearly 60% of U.S. agricultural exports to China. China did not choose soybeans for random retaliation. Eight of the top 10 soybean-producing countries voted for Trump in 2016, including many major Swing States.8 The simple reference to purchasing goals is not only about China`s problematic policy, which hurts Americans, but also helps shore up state planning as opposed to commercial outcomes. In particular, because China continues to impose discriminatory retaliatory duties on U.S.

exporters, only its state-owned enterprises, not the Chinese private sector, will increase many purchases to meet their commitments, the opposite of what U.S. politicians say they want. The objectives of the agreement also send signals to America`s allies that the United States is primarily interested in China diverting imports from its suppliers, rather than attacking China`s problematic policies and undermining their confidence in U.S. policy. Such a sharp increase in U.S. imports will allow China to reduce its imports from other countries to offset its overall trade balance. However, in the run-up to the U.S. election, evidence indicates that the agreement is not keeping Trump`s promise.1 The latest official data show that China is not up to expectations and is only reaching 53 percent of the expected purchase target by September 2020. Indeed, Chinese imports of U.S. goods are now weaker than before Trump`s trade war with a flash of U.S.

tariffs on Chinese goods in 2018. This first trade agreement is seen as the first sign of de-escalation in the long trade war between the United States and China. For more than 18 months, the world`s two largest economies have been fighting crises, followed by back-and-forth negotiations week after week – not to mention a customs war, the introduction of foreign technological restrictions and WTO business.