Asia Business Channel

US–China Trade War - Trump says there’s a “Partial – Phase 1” trade agreement with China ~ but nothing has been written or signed

Chinese Vice Premier Liu He and US President Donald Trump at the White House in Washington, after the two sides agreed on an outline for a partial trade deal ~ Photo courtesy of Bloomberg

 

Seeking to change the news cycle after a week of bad news related to his impeachment inquiry, US President Donald Trump announced a “partial” trade deal with China and said that the deal would generate $50 billion USD in sales for US agriculture projects and be a boom to farmers.

In typical Trump fashion, the president declared it the “greatest farm trade deal ever” and that farmers will be ecstatic over the deal. Trump said on Twitter that, “WOW, the Farmers really hit pay dirt."

Trump desperately needs to curry the favor of farmers for his 2020 reelection campaign and he believes that senators from states dependent upon agriculture will vote against his impeachment if a trade deal with China that is favorable to farmers is concluded before the election cycle begins in earnest next year.

Critics and naysayers of the president’s announcement noted the following facts:

(1) The “partial” trade deal is only a verbal agreement and there is nothing on paper

(2) The president said that it would take “5 weeks” to have the “partial” trade deal committed to paper

(3) China has not agreed to sign a “partial” trade deal and says it will not even consider doing so until the agreement is in writing

(4) The new trade deal does not roll back tariffs already in place on hundreds of billions of dollars in two-way trade

(5) Morgan Stanley issued a warning over the weekend that tariff escalation remains a ‘meaningful risk’ despite a partial trade deal

(6) The National Farmers Union president said that the president has new competitors / suppliers to China have been created because trade war and that there is no long-term guarantee that China will not buy products from them

The only winner in the trade war at this point is China. Trump announced that he plans to delay the implementation of additional trade tariffs on Chinese goods that were scheduled to take effect this week.

 

 

 

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