From staff and wire reports
The United States and China reached a trade deal Wednesday that eases tensions between the world’s two biggest economies, offers massive export opportunities for U.S. farms and factories, and promises to do more to protect American trade secrets.
President Donald Trump promoted the trade signing as a way of delivering economic justice for American workers he claims have been betrayed by past administrations and their trade policies.
“We mark more than just an agreement. We mark a sea change in international trade,” Trump declared.
The Chinese delegation also praised the pact. Chinese leader Xi Jinping said in a letter to Trump that the first-phase deal was “good for China, for the U.S. and for the whole world.” He said it also showed the two countries had the ability to “act on the basis of equality and mutual respect.” The letter was read by Beijing’s chief negotiator, Vice Premier Liu He.
Closer to home, Alabama’s largest agriculture organization hailed the “phase one” deal with China as a “step in the right direction” for farmers who have been caught in the middle of the trade war.
“This trade deal is a step in the right direction and a welcome sign for our farmers who have been dealing with low commodity prices,” said Alabama Farmers Federation President Jimmy Parnell. “We appreciate the administration fighting for better trade deals for agriculture.”
A look at highlights of the 86-page deal.
China agreed to increase purchases of U.S. services and manufactured, energy and farm products by $200 billion this year and next. The arrangement means that China is supposed to buy $40 billion a year in U.S. farm exports. It’s an ambitious goal. China has never bought more than $26 billion in U.S. agricultural products in a year.
The United States dropped plans to extend tariffs to an additional $160 billion worth of Chinese imports. That move, originally scheduled for Dec. 15, would have extended the tariffs to just about everything China ships to the United States. The U.S. also cut in half, to 7.5%, the U.S. tariffs on another $110 billion in Chinese goods. Still, the U.S. maintains tariffs on $360 billion worth of Chinese imports, nearly two-thirds of the total. It’s a figure that would have been unthinkable before President Donald Trump took office and took a far more aggressive approach to China and trade. It is unclear what China is going to do with the retaliatory tariffs it has imposed on U.S. products.
China pledged to stop forcing U.S. and other foreign companies to hand over technology as the price of admission to the Chinese market. Any transfer of technology must be made for business reasons and not be coerced. Still, China has sworn off forced technology transfers before.
The agreement makes it easier to bring criminal cases in China against those accused of stealing trade secrets. It includes provisions designed to stop Chinese government officials from using administrative and regulatory procedures to ferret out foreign companies’ trade secrets and allowing that information to get into the hands of Chinese competitors.
The deal also requires China to come up with procedures to “permit effective and expeditious action’’ to take down websites that sell pirated goods. China also must make it possible for e-commerce sites to lose their licenses for “repeated failures to curb the sale of counterfeit or pirated goods.’’