US Products Purchase of $200 Billion Announced... Actual Purchase by China Reaches Only 59%

Last January US-China Trade Agreement Ineffective... China Expected to Record Record-High Trade Surplus with US This Year

U.S. President Joe Biden (left) and Chinese President Xi Jinping
[Photo by AFP Yonhap News]

[Asia Economy Reporter Park Byung-hee] Although China promised to purchase an additional $200 billion worth of U.S. products under the U.S.-China Phase One trade agreement signed in January last year, the actual purchase amount has been confirmed to be only about 59% of the target.

The United States and China signed the U.S.-China Phase One trade agreement in January last year. At that time, the U.S. and China agreed to end the trade war that began in July 2018 when the Trump administration imposed large-scale tariffs on Chinese products after 18 months, and to build a fair and mutually beneficial trade relationship. Ahead of the signing of the Phase One trade agreement, the Trump administration also showed goodwill by removing China from the 'currency manipulator' list.

According to the trade agreement at the time, the U.S. agreed to withdraw additional tariffs on Chinese products, and China agreed to purchase $200 billion (231.7 trillion won) more U.S. products over two years by the end of 2021 compared to 2017.

However, as the deadline for the $200 billion purchase agreed upon at the time approaches, China's actual purchase amount has been confirmed to be far short of the target. As of last month, Bloomberg reported on the 22nd (local time) that the additional U.S. products purchased by China amounted to only about 59% of the target.

After the Phase One trade agreement, China's imports from the U.S. increased sharply, breaking records. However, due to COVID-19, China's exports to the U.S. increased rapidly, overshadowing the expansion of China's imports from the U.S.

China is expected to achieve a record-high trade surplus with the U.S. for the second consecutive year this year. Bloomberg reported that China's trade surplus with the U.S. exceeded $358 billion through November this year.

Although there are criticisms that the original $200 billion additional purchase target was unrealistic, the U.S. is likely to demand China to resolve trade imbalances due to the failure to fulfill the $200 billion additional purchase promise and the huge trade deficit with China. Last month, U.S. President Joe Biden raised concerns about China's unfair trade practices during his first virtual summit with Chinese President Xi Jinping since taking office.

The U.S. and China are still clashing while imposing punitive tariffs. Former U.S. Ambassador to China Gary Locke said, "Unless China shows a clear change in stance or attitude in economic and trade policies, I think it will be very difficult for the Biden administration to reduce or eliminate tariffs."

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