Trump, Xi Jinping to sign 'phase one' of US-China trade agreement

United States President Donald Trump said on December 24 that he and Chinese President Xi Jinping will have a signing ceremony for the 'first phase' of the US-China trade deal agreed to this month. Trump told reporters that there will be a signing ceremony when the two leaders will get together. The US President further added that it would be a 'quicker signing' because he and Xi 'want to get it done' and the deal is complete.

US Trade Representative Robert Lighthizer said on December 13 that representatives from both the countries would sign the Phase I trade deal agreement in the first week of January. However, Beijing has not yet confirmed specific components of the deal that were released by the US officials. 

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Trade deal after two and a half years

After nearly two and a half years, a deal has been in the negotiations between Washington and Beijing. This agreement will reportedly reduce a part of US tariffs on Chinese goods in exchange for the increased purchases of the US agricultural, manufactured and energy products by some $200 billion over the span of two years. Beijing has even promised the protection of US intellectual property. This will curb the coerced transfer of American technology to the Chinese firms and open the country's financial services market to American firms along with avoiding manipulation of currency. However, the date to officially sign the trade agreement has still not been decided.

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Increase in Chinese purchases expected

The American agricultural products sales are expected to increase from $40 billion to $50 billion annually for the next two years through Chinese purchases. In 2017, the US has exported nearly $24 billion farm products in China and even the last full year, before the greatest trade war in history began in July 2018.

The president of the American Chamber of Commerce in Shangai, Ker Gibbs reportedly said that for an agreement between Washington and Beijing, the key areas shall be the enforcement mechanisms along with agricultural purchases. However, it has also been acknowledged that in case these purchases fail to happen the way they are planned by the officials, it would give rise to yet another 'credibility issue' which would make things backwards.

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Several Chinese officials have told an international news agency that the wordings of the trade pact still remain a delicate issue in the current stage of negotiations. According to a Beijing report, the first stage of the agreement is a 'phased achievement'. However, it still does not mean that trade disputes between both the economies will be 'settled once and for all'. The deal has suspended another round of threatening US tariffs on a $160 billion list of Chinese imports that were expected to be on effect since December 15.

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(With agency inputs)