Donald Trump says China is buying ‘a lot’ of US products

Robert Delaney

US President Donald Trump suggested on Friday that his trade deal with China was intact, delivering a rare note of optimism about bilateral relations with Beijing at a time of unprecedented strain between the two sides.

Speaking in a White House briefing meant to tout unexpectedly upbeat employment data released earlier in the day, Trump noted that the country is buying “a lot” of American goods, but added that a positive outcome was not guaranteed. He also reiterated criticism about Beijing’s handling of the coronavirus pandemic.

“I will say [China is] buying a lot from us, and in that way I respect, and getting along with China would be a good thing,” Trump said. “I don’t know if that’s going to happen. I’ll let you know.”

Discussing efforts by world leaders to recover from the coronavirus pandemic, Trump said: “We’re working with the world and we’ll work with China too. We’ll work with everybody.”

The phase-one trade deal ended threatened tariffs on around US$155 billion worth of Chinese imports that were set to take effect at the end of 2019 and halved tariffs to 7.5 per cent on another US$120 billion in goods. But it kept in place the 25 per cent import taxes on US$250 billion worth of Chinese products.

“The priority the two sides are placing on the deal is not so much a way to repair damage as it is to not cause further damage,” said Mary Lovely, a senior fellow at the Washington-based Peterson Institute for International Economics. “If the US announces the deal is dead, Trump is locked into some kind of retaliation.”

“Both sides would suffer more deeply than in earlier round, either because higher rates mean higher economic dislocation and distortion, or [because] tariffs would be extended to the highly valuable flows of computers and cell phones that form the backbone of tech supply chains,” she said.

China subtly, quietly implementing phase one trade deal despite US tensions

Trump’s comment follows a statement by the Office of the US Trade Representative (USTR) last month that China has opened its markets to blueberries, California Hass avocados, barley and other livestock feed grains, and approved imports of meat from more American processing facilities.

Other measures taken by China to meet the terms of the deal, which Trump signed with Chinese Vice-Premier Liu He in January, include a loosening of import restrictions on American potatoes and pet food products, an end to a ban on US poultry products and a broadening in the lists of facilities from which the US may export animal proteins, pet food, dairy and infant formula to China.

“President Trump’s comments are the latest example of both the US and China ring-fencing trade issues and keeping the phase-one trade deal moving forward, despite many continuing frictions elsewhere in their geopolitical relationship,” said Terry Haines, an independent policy analyst and former congressional staffer.

US sales of soybeans to China nearly doubled to 12.7 million tonnes in the marketing year that ended last month, according to data published by the US Department of Agriculture’s Foreign Agricultural Service.

Meanwhile, corn shipments to China more than doubled to 1.1 million tonnes, and wheat sales surged more than tenfold to 550,000 tonnes.

“Trump pointing out that China is making good on its phase-one trade commitments is a positive signal to financial markets that neither Trump nor [Chinese President] Xi Jinping intend for US-China tensions to hobble or destroy the two countries’ commercial relationship,” Haines said.

Moreover, he noted, US swing states in the coming election – in which Trump is seeking a second term as president – benefit greatly from China purchases.

However, Haines cautioned that Trump’s statement should not be regarded as suggesting any US backing off its commitment to take Hong Kong-related actions including sanctions. “It should be read as a clue to US desire to make eventual US Hong Kong actions more surgical and precise.”

Still, Trump’s comments about China on Friday included some familiar barbs, including a reference to “the China plague”, a resumption of rhetoric that sparked a diplomatic stand-off as Covid-19 cases and deaths began a dramatic escalation in the US in March.

At the time Trump and Secretary of State Mike Pompeo began voicing accusations including a theory that China developed the coronavirus in a lab, while Beijing’s Foreign Ministry spokesman Zhao Lijian suggested the US military might have deliberately released the contagion in China last year.

After the coronavirus emerged in China’s central city of Wuhan last year, “it didn’t go to Beijing, it didn’t go to other parts of China … How come it came out to Europe, to the world, to the United States,” Trump said in Friday’s briefing. “Somebody has to ask these questions.”

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