U.S.-China trade deal that satisfies no one to be signed Wednesday
Photo credit: The China Project illustration by Derek Zheng
โWe must bear in mind that the trade war is not over yet โ the U.S. hasnโt revoked all its tariffs on China and China is still implementing its retaliatory measures. There are still many uncertainties down the road.โ
That is the view from Beijing, as told by Taoran Notesย (in Chinese), a WeChat blog โaffiliated with the official Economic Daily newspaper that is used by Beijing to manage trade talk expectations,โ the South China Morning Post reports.
โThe U.S. hasnโt revoked all its tariffs on Chinaโ is a vast understatement.ย According to calculationsย by Chad Brown at the Peterson Institute of International Economics, the โphase oneโ trade deal that is expected to be signed in Washington, D.C., this Wednesday will reduce Trumpโs tariffs by less than 2 percent โ from 21 percent to 19.3 percent.
โThe deal isnโt what either side said it had wanted,โย the Wall Street Journal summarizesย (paywall). โThe U.S. doesnโt get the fundamental reforms in Chinese economic policy it sought to help American businesses. And levies remain on about $370 billion of Chinaโs exports.โ
Back to the status quo we go
Trump is preparing to rebrand a preexisting part of U.S. foreign policy and call it a win, even though it changes little in substance, a separate report in the WSJ suggestsย (paywall). The upcoming trade pact will establish โat least bi-annual meetings,โ tentatively called the Comprehensive Economic Dialogue โ essentially just a new name for what was called the Strategic and Economic Dialogue in the Obama administration. If this pattern of rebranding sounds familiar, thatโs because itโs exactly what happened with NAFTA.
Another piece of the status quoย that is being restored: The Trump administration has agreed to revokeย its designation of China as a โcurrency manipulator,โ which was made largely as an act of political symbolism last August.