Wednesday, May 18, 2022

Biden says ‘not there yet’ on possible easing of tariffs on Chinese goods

China has fallen short of its pledge under the two-year Phase 1 trade agreement to buy US$200 billion in additional US goods and services during 2020 and 2021, and it remains unclear how the shortfall will be addressed.

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President Joe Biden on Wednesday said it was too soon to make commitments on lifting US tariffs on Chinese goods, but his chief trade negotiator Katherine Tai was working on the issue.

“I’d like to be able to be in a position where I could say they’re meeting their commitments, or more of their commitments, and be able to lift some of them, but we’re not there yet,” Biden told a news conference at the White House.

He was referring to China’s commitments under a Phase 1 trade deal signed by his predecessor Donald Trump.

China has fallen far short of its pledge under the two-year Phase 1 trade agreement to buy US$200 billion in additional US goods and services during 2020 and 2021, and it remains unclear how the shortfall will be addressed.

Chinese purchases reached only about 60% of the target through November 2021, according to data compiled by the Peterson Institute for International Economics. The US Census Bureau is expected to release December data next week.

Biden said he was aware that some business groups were clamoring for him to start unwinding US tariffs of up to 25% imposed by Trump on hundreds of billions of dollars of Chinese imports, and that was why Tai was working on the issue.

But he said it was too soon to move forward given China’s failure to boost its purchases.

China last week said it hopes the US can create conditions to expand trade cooperation.

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