Coronavirus or not, China to honour trade deal with US
Beijing is cutting tariffs on many US imports to meet its commitment to buy US200 billion in US products and services. Imports are also needed to face the coronavirus outbreak. Doubts remain about its ability to buy US.5 billion in agricultural products from the United States.
Beijing (AsiaNews/Agencies) – Despite the impact on its economy of the ongoing COVID-19 epidemic, China is going ahead with phase one of the trade agreement it reached with the United States last month.
The deal ends a trade war unleashed by the Trump administration in 2018, committing China to boost its purchases of US goods and services by US0 billion over two years, including US.5 billion in agricultural products in the first year, and more than US billion in energy products.
For its part, the US halved its 15 per cent additional tariff on US0 billion in Chinese imports to 7.5 per cent.
The Customs Tariff Commission of China’s State Council also announced on Friday a one-year tariff exemption on 55 imported products, including medical diagnostics equipment used in the fight against the coronavirus outbreak, starting 28 February.
The country’s healthcare system has been under heavy strains since the start of the COVID-19 outbreak, showing its limitations.
Earlier this week, Chinese authorities said they would lift tariffs on nearly 700 types of US goods, including temperature sensors used in the fight against the epidemic.
On 14 February, China further halved tariffs on US billion of American products imposed last year, including poultry. China’s own poultry industry is susceptible to the H5N1 bird flu.
China thus hopes Chinese companies will buy US products, provided they make the necessary market assessments before making their purchases.
In theory, Beijing could invoke the emergency situation to defer the trade agreement with the US. But fear that Trump might retaliate appears to underscore its decision to maintain its commitments.
China also needs imports since the lockdown on many economic activities imposed by the authorities in recent weeks prevent domestic businesses from meeting local demand.
However, the US Department of Agriculture estimates that China might be able to increase its agricultural purchases by only US billion between now and September and so might not be able to fulfill its promise.