China may not fulfill its obligations under the so-called “phase one” trade deal touted by President Trump, according to officials and analysts.
“For China, committing to and carrying out the phase one agreement is a huge challenge,” Shi Yinhong, a Chinese government adviser, said Monday. “China will need to buy something like US$300 billion worth of US products in the next two years and lots more US agricultural goods. Does China need that amount of US soybeans?”
Trump’s trade team described the deal as a “remarkable agreement” while conceding that its success depends on China. Rumblings out of Beijing suggest that Chinese officials won’t comply with the unsigned pact.
“They’re setting up a defense, right?” Malcolm McNeil, an international trade attorney and partner at Arent Fox law firm, told the Washington Examiner. “It’s a signal: ‘Yeah, we wanted to buy the soybeans, we’re acting in good faith, but we didn’t need all those soybeans, so that’s why we didn’t buy them all, but we told you that in the beginning that we might not be able to, but we wanted to.’ That kind of thing.”
Chinese officials caution that they need to review the agreement and negotiate the details of when to sign the deal. “Our two sides still need to go through necessary procedures, including legal reviewing and translation proofreading,” Geng Shuang, a Chinese Foreign Ministry spokesman, told reporters Monday. “After that, we will decide when, where, and how we will sign it.”
Trump’s top trade hawk maintains that the administration is “right where we hope to be” in terms of implementing the president’s trade agenda.
“This is a real structural change,” U.S. Trade Representative Robert Lighthizer said Sunday while touting new restrictions on the practice of forcing American companies that work in China to transfer sensitive technology to their local partners. “Is it going to solve all the problems? No. Did we expect it to? No. Absolutely not.”
Lighthizer hailed the deal, which was unveiled on the same day that White House officials made an agreement with House Democrats to replace NAFTA with the U.S.-Mexico-Canada Agreement, as one part of “the most momentous day in trade history ever.” Chinese officials are not so pleased, according to Shi, the government adviser.
“Look at Trump and Lighthizer, they are very happy,” Shi said. “But our government only reported facts; we did not cheer.”
Senate Minority Leader Chuck Schumer, who has found a rare point of agreement with Trump on China in recent years, denounced the deal. “At first, President Trump seemed like the only president who would dare tackle this challenge; but now, according to reports, he has sold out for a temporary and unreliable promise from China to purchase some soybeans,” the New York Democrat said Friday. “We’ve heard this song and dance from China before.”
McNeil surmised that Trump is trying to maintain a good relationship with Chinese President Xi Jinping after signing a bill designed to deter Beijing from using brutal tactics to repress the protests that have gripped Hong Kong in recent months.
“I think that he got played a little bit, but this is his olive branch to Xi after having signed the Hong Kong democracy bill,” McNeil said of Trump. “So, it’s part of horse trading, so it’s hard for me to say he was played. I think he could have been played or it could have been part of a shrewder long-term strategy.”
