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Theme: |
International trade |
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Country: |
United States / China |
The main thrust of this agreement remainsBeijing's guarantee of the purchase of American products.
200 billion dollars purchased by Beijing
White House economic advisor Larry Kudlow detailed the distribution of these purchases: Chinese imports of American manufactured goods will increase by $75 billion over the next two years, energy orders of USD 50 billion, and services (including financial) by USD 45 billion.
With the forty billion dollars promised for agricultural products (mainly pork and soya), the total would reach the 200 billion dollars announced by the Americans for several weeks.
The US trade deficit vis-à-vis China, which was set at $295.8 billion last year, may not be sufficient to absorb it.
Customs duties retained
In turn, the United States is giving up further increases in taxes on imported Chinese products, as announced.
However, the customs duties already implemented have not been abolished. The US sanctioned 360 billion Chinese imports.
« I will agree to delete them if we can conclude phase 2. Otherwise we won't have any cards to negotiate »explained Donald Trump. And the threat of other taxes is not ruled out, if China does not keep its promises.
This agreement should therefore not completely erase the effects of trade war.
According to Oxford Economics, it should barely reduce its impact (0.1 points), while Larry Kudlow estimates that the agreement will boost US GDP by 0.5% in 2020 and 2021. As uncertainty is not removed, business investment may continue to suffer.
One thing is certain: trade between the two countries has already declined by 15% since the beginning of the trade war. And in the long run, they could fall from 30 to 40%, according to Oxford Economics.
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