US says China would honour trade agreements despite tensions
WASHINGTON On June 17, US Secretary of State Mike Pompeo met with Yang Jiechi, a member of the Chinese Communist Party Politburo, in Honolulu to discuss the growing tensions between the US and China. Mr. Pompeo stated that Mr. Yang did recommit China to fulfilling its obligations under the phase one trade agreement, including the purchase of $36.5 billion worth of US food and agricultural products in 2020. Despite this, the sessions did not result in any new agreements, resolutions, or statements regarding the tense relationship.
During a press conference on the Hawaii summit, Assistant Secretary for East Asia and Pacific Affairs David Stillwell stated that this recommitment alone did not constitute a significant advancement.
Mr. Stillwell stated, “The Chinese have reiterated their commitment to that multiple times, not just recently but since the last year when it was signed, and they insist that they will follow through.” As you know, trade helps both parties equally when done right, so this is a good acid test to see whether they will be cooperative partners and if they will once more utilise words and deeds to create this trust in the trade realm, which is arguably the most fundamental facet of this relationship.
What the two diplomats talked about in relation to the phase one agreement was not included in a statement released by Zhao Lijian of the Chinese Ministry of Foreign Affairs regarding the meeting between Mr. Yang and Mr. Pompeo. The statement, on the other hand, denounced US meddling in Chinese domestic matters concerning Taiwan, Hong Kong, and the plight of the Uighur Muslim minority in northwest China’s Xinjiang province.
China will need to significantly increase its imports of US farm products if it is to fulfil its obligations under the terms of the phase one deal. According to data from the US Department of Agriculture, China spent just $4.65 billion on US agricultural goods in the first four months of 2020.
China has increased its purchases of US soybeans during the last few weeks. According to the USDA, 12.8 million tonnes of US soybeans were exported or sold to China unfulfilled in 2019–20 as of June 11. Furthermore, China has ordered 3 million tonnes of soybeans, which will be delivered between September 1 and October 1, 2020–21.
Additionally, 63,000 tonnes of US hard red winter wheat were recently purchased by China.
Separately, the administration released more conflicting statements regarding the US-China relationship. In a June 17 testimony before the House Committee on Ways and Means, US Trade Representative Robert Lighthizer stated that a complete decoupling of the US and Chinese economies was not “a reasonable policy option.”
“It was not Ambassador Lighthizer’s fault (yesterday in Committee) in that perhaps I didn’t make myself clear, but the US certainly does maintain a policy option, under various conditions, of a complete decoupling from China,” tweeted President Donald Trump in response the following day. I’m grateful.