COSMETIC:The only truly new development is a plan to speed up direct exports of US liquefied natural gas to China, delighting some in the US hydrocarbon industry.
The new trade agreement unveiled on Friday between China and the US is yet another olive branch from US President Donald Trump’s White House to Beijing, but some skeptics wonder how long the cooperative tone will last.
One thing is certain: the initial measures of the 100-day action plan launched in the middle of last month by China and the US stand in stark contrast with the anti-Chinese rhetoric Trump used as a presidential candidate on the campaign trail.
The president has significantly softened his stance, last month declining to declare China a currency manipulator — one of the most strident pledges he made as a candidate.
In addition, at least at first glance, the new Sino-American trade deal appears to have vindicated this softer approach that is starting to bear fruit.
The two-page plan of action calls for the lifting of the 13-year embargo Beijing had kept on US beef, as well as gradually opening the Chinese market to certain US financial services.
“It’s impossible to overstate how beneficial this will be for America’s cattle producers,” US National Cattlemen’s Beef Association president Craig Uden said, adding that he was eager to court 1.4 billion new consumers in China.
As important as they might be, these developments are not entirely new. Plans to lift the beef embargo had already been agreed to in principle in September last year under former US president Barack Obama.
The only truly new development was the plan to speed up direct exports of US liquefied natural (LNG) gas to China, delighting some in the US hydrocarbon industry.
“It’s a strong signal from both governments that there is a real interest in using LNG produced in the US in China,” Center for Liquefied Natural Gas director Charlie Riedl said.
As for the Chinese, they got the US to lift trade barriers to Chinese exports of cooked poultry, a concession that does not appear to worry US producers.
“It would serve a niche market and we don’t think that it would be a problem for our domestic industry,” USA Poultry and Egg Export Council director Jim Sumner said.
These achievements are the low-hanging fruit, Carnegie Endowment for International Peace China expert Douglas Paal said.
“It’s not negative but it’s not a major step,” he said. “These are the easy steps. The heavy work hasn’t started yet.”
Indeed, the agreement does not touch on theft of intellectual property or the US manufacturing sector, which has suffered most of all from Chinese competition — and which Trump had promised to rescue on his arrival in the White House.
Imports of Chinese-manufactured goods are nevertheless blamed for the colossal US trade gap in goods with China, which stood at US$347 billion last year. Trump has vowed to reduce it.
“For American manufacturing, there’s not a lot there although I’m not terribly surprised,” Alliance for American Manufacturing president Scott Paul said. “Those issues are going to be much harder to solve.”
Trump’s administration might need to get tougher, even threaten sanctions or fresh trade barriers, to win concessions from Beijing, Paul said.
“The administration may need to take a more aggressive stance,” he said.
Analysts say that, despite its repeated promises on joining the WTO in 2001, China has still not honored promises to open its markets to foreign competition.
“There’s a lot of skepticism about whether or not China will really follow through,” Paal said. |
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