[US-China New Cold War] Trade Agreement Falters Amid COVID Conflict... New Cold War Crisis

China's Imports of U.S. Soybeans Plummet... Imports in Last Week of April One-Tenth of Last Year
Possibility of Trade Agreement Adjustments

[Asia Economy Beijing=Special Correspondent Park Sun-mi] It has been revealed that the Phase One trade agreement between the United States and China, signed last January, has not been properly implemented since the outbreak of the novel coronavirus disease (COVID-19). Amid the US-China conflict triggered by disputes over responsibility for the spread of the COVID-19 virus, concerns are rising that the failure to fulfill the trade agreement could become another catalyst for a second trade war. In particular, as China has regained public support through early control of COVID-19, it is expected to intensify its responses as US offensives increase, leading to a forecast of a deepening new Cold War crisis.

According to the US Department of Agriculture and China's General Administration of Customs, China's imports of US soybeans sharply declined after late March. Since mid-March, when US criticism of China intensified following the COVID-19 outbreak, China's momentum to purchase US agricultural products weakened. In fact, US soybean exports to China were nonexistent for two weeks in March. Furthermore, in the last week of last month, US soybean exports to China amounted to only 10,375 tons, less than one-tenth of the volume a year earlier.

Earlier this year, China actively purchased US agricultural products to fulfill its promise under the Phase One trade agreement to "purchase an additional $200 billion (approximately 245 trillion KRW) worth of US products and services over the next two years," showing a completely different trend. From January to March, China's imports of US soybeans increased by 210% compared to the same period last year, reaching $21.88 billion, totaling 7.8 million tons.

The US, as the world's largest crude oil importer, had hoped that China would purchase more US crude oil during the implementation of the trade agreement, but this also did not materialize. In the first quarter of this year, China imported $114 million worth of petroleum and other mineral fuels from the US, less than half of the amount a year earlier. Instead, during the same period, China purchased $11.3 billion from Russia and $10.7 billion from Saudi Arabia. With international oil prices plummeting and demand decreasing, it has become practically difficult for China to increase imports of US crude oil. The Hong Kong South China Morning Post (SCMP) diagnosed that "COVID-19 has made it unlikely that China will fulfill its promises under the Phase One trade agreement with the US."

Analysts say that China's response to the US has changed compared to the trade war fought until last year. It has become bolder. Therefore, China's failure to import US soybeans and other products is interpreted as a sign that China will not implement the Phase One trade agreement following the COVID-19 outbreak.

There is also speculation within China about the possibility of attempting to adjust the terms of the US-China agreement. This can be seen in the follow-up measures after the trade agreement signed last January. The US Trade Representative announced in mid-February that the trade agreement was effective and that a dedicated office for bilateral evaluation and dispute resolution had been established. On the other hand, China has not announced details regarding the establishment of an independent organization. Moreover, contrary to the US demand to implement the Phase One trade agreement regardless of COVID-19, China has not disclosed detailed information about the implementation of the agreement. The only statement last month was from Cui Tiankai, China's ambassador to the US, who mentioned, "China is still purchasing US agricultural products." Rather, voices within China, mainly from scholars, are calling for a readjustment of the US-China trade agreement to reflect the COVID-19 situation.

After controlling the internal spread of COVID-19 and expanding international support, China is preparing to confront US attacks head-on. On this day, the Chinese Communist Party's official newspaper, the People's Daily, directly criticized President Donald Trump's flawed COVID-19 response in its "Zhongsheng (Bell Sound)" commentary on major international issues. It quoted an article from the US media that stated, "Although many aspects of life have changed in the past two months due to COVID-19, the only thing that has not changed is the Trump administration's failed foreign policy." The Global Times also criticized in an editorial that "politicians in the Trump administration, including Secretary Pompeo, continue to spread the baseless theory that the virus originated in China."

Even when US-China relations were strained due to the trade war, Chinese media only criticized US unilateralism and protectionism without directly mentioning President Trump or Secretary Pompeo. However, since March, when the Chinese state-run Xinhua News Agency referred to the US COVID-19 outbreak as the "Trump Pandemic," Chinese media attacks have focused directly on the Trump administration.

China also demonstrated confidence in responding to US military provocations by conducting military exercises in the South China Sea over the weekend. Experts say US-China relations are deteriorating to the worst level ever, mentioning the new Cold War crisis. Professor Si In-hong of the School of International Relations at Renmin University said, "The US and China have effectively entered a new Cold War era," adding, "Unlike the Cold War between the US and the Soviet Union, the US-China Cold War is characterized by full-scale competition and rapid fragmentation."

This content was produced with the assistance of AI translation services.