Many remain concerned about relations between the United States and China.
Beijing this week threatened countermeasures, if sanctions are to be imposed. First Squawk reported the latest development, which further complicates the month’s old Phase One trade agreement.
Jennifer Hillman, senior fellow for Trade and International Political Economy with the Council on Foreign Relations, analyzes the unique relationship between the world’s largest economies.
There have recently been a few bumps in the road. However, progress has been made in regards to the Phase One trade agreement, says Hillman.
“Progress has been made, even notwithstanding the pandemic,” Hillman said. “We’ve seen a number of dairy companies become certified to sell products to China, restrictions on beef and poultry exports loosened, and China removed all of its tariffs on poultry. On the regulatory side of things, again, we’ve seen good progress.”
Trade advisors set large quotas for China. The Asian nation must buy twelve-point-five-billion dollars more in agricultural goods this year than it did in 2017, says Hillman.
Recent trade data suggests heightened agricultural purchases from China, but the nation remains “far behind” it’s goal.
“Chinese imports were five-point-one-billion dollars compared to a target of about nine-point-one-billion dollars, only 37-percent of the target we expected for the first quarter of this year. Because China’s commitments are only done on an annual basis, there is no requirement for China to ship a certain amount during a certain month or quarter,” Hillman said.
Hillman speaks to skepticism about China’s ability to meet provisions outlined in the Phase One trade agreement. She believes this feat is “possible, but not likely.”
“Some of the skepticism is that China has left in place some of the retaliatory tariffs it put on agricultural exports, in part because the United States has left on virtually all of the tariffs imposed on China as a result of this trade war. What we have not seen is an elimination of the tariffs on either side as a result of this truce,” Hillman said.